System and method for allocation to obtain zero activity in a selected aggregated account with holdback

ABSTRACT

A method, system and program product, the method comprising: accessing one or more databases comprising: aggregated deposit account information for a plurality of government-backed insured and interest-bearing aggregated deposit accounts held in a plurality of deposit institutions, and client information; determining at least one aggregated deposit account to which to deposit/transfer or to withdraw/transfer funds based at least in part on one or more selection rules; obtaining transfer data; allocating funds to one or more of the aggregated deposit accounts based on the transfer data and on one or more allocation rules; allocating fund amounts of client accounts to substantially match the respective amounts allocated; generating and communicating data for one or more instructions to transfer funds based at least in part on one or more of the allocating steps; and updating the one or more databases.

RELATED APPLICATIONS

This application is a Continuation of U.S. application Ser. Nos.11/767,827 filed Jun. 25, 2007 and 11/767,846, filed Jun. 25, 2007. SaidU.S. application Ser. Nos. 11/767,827 and 11/767,846 are Continuationsof U.S. application Ser. No. 11/689,247, filed Mar. 21, 2007, whichclaims priority from Provisional Application U.S. Application60/892,107, filed Feb. 28, 2007, and Provisional Application U.S.Application 60/895,320, filed Mar. 16, 2007. All these applications areincorporated herein by reference in their entirety.

This application is related to U.S. application Ser. No. 09/176,340filed Oct. 21, 1998, now U.S. Pat. No. 6,374,231 issued Apr. 16, 2002entitled “Extended Coverage Monetary Regulation System”, and U.S.application Ser. No. 10/071,053, filed Feb. 8, 2002, and U.S.application Ser. No. 09/677,535, filed Oct. 2, 2000. The disclosures ofall these applications are hereby incorporated by reference as if fullyset forth herein.

FIELD OF THE INVENTION

The present invention generally relates to a system and method formanaging aggregated accounts.

BACKGROUND OF THE INVENTION

Securities brokerage cash management systems, such as the systemdisclosed in U.S. Pat. No. 4,774,663 to Musmanno et al. (“theMusmanno”), are useful in managing data processing and informationbetween securities brokerage accounts, individual deposit accounts anddeposit institutions. The Musmanno, for example, discloses a system inwhich subscriber expenditures, such as charge card use, check and/orcash advances are applied on a hierarchical basis against thesubscriber's free credit balance, short term investment and the lendableequity in the subscriber's securities account. On a periodic basis,received card charges, check, securities and deposit transactions forthe account participants are verified and employed to compute an updatedcredit limit for each subscriber. Other accounting systems, such as thesystem disclosed in U.S. Pat. No. 5,893,078 to Paulson, are primarilydirected to managing sweep transactions, in which a bank account sweepsany unused funds into a higher-interest earning account.

However, these cash management systems are not capable of monitoring andmanaging aggregate activity between banks, financial entities andindividual financial entity clients. In particular, these known systemsare not flexible enough to operate within the varying confines ofdiverse financial programs and products, and manage data relating tofinancial entities, clients and/or banks working under these programsand products. The conventional system structure also does not allow foreasy computation of individual client account balances, interestpayments, deposits and withdrawals.

It should be noted that as of the date of this filing, at least theassignee Reserve Management Corporation (aka “The Reserve”), offers theability for customer financial institutions such as broker dealers tooffer FDIC insurance over the $100,000 FDIC limit for client accountsthereat by distributing the funds to a plurality of aggregated accountsat a plurality of different deposit institutions.

Accordingly, there is a need for a system and method for managingaggregated investment accounts that allows for easy settlement of andcomputation of net activity for each account, while also providingefficient reporting of data relating to the accounts to financialentities and deposit institutions.

SUMMARY OF THE INVENTION

In one embodiment a method is disclosed for managing a plurality ofFDIC-insured and interest-bearing aggregated accounts held in aplurality of deposit institutions, with each of the deposit institutionsholding at least one of the aggregated accounts, each of the aggregatedaccounts holding funds of a plurality of client accounts, comprising:accessing, by one or more computers, one or more databases comprising:(1) aggregated account information for a plurality of the FDIC-insuredand interest-bearing aggregated accounts held in the depositinstitutions, wherein funds from client accounts of a plurality ofclients are aggregated with funds of other client accounts in theaggregated accounts held in the deposit institutions, wherein each ofthe respective deposit institutions holds one or more of the aggregatedaccounts; and (2) client account information for each of the respectiveclient accounts comprising: (i) a respective client asset balance in therespective client account; (ii) transaction data for the respectiveclient account; and (iii) a respective balance of funds from therespective client account held in each of one or more of theFDIC-insured and interest-bearing aggregated accounts holding funds ofthe respective client account; and determining, by one or morecomputers, deposits to and withdrawals from the aggregated accounts, thestep of determining comprising: (1) accessing, by the one or morecomputers, transaction data comprising deposit amounts to and/orwithdrawal amounts from one or more of the client accounts for asub-period of time; (2) calculating, by the one or more computers, foreach of a respective one or more of the aggregated accounts held in eachof a plurality of the deposit institutions, a first net transactionamount with respect to the respective aggregated account based ontransaction data for the sub-period of time for client accounts withfunds held therein; (3) determining, by the one or more computers, forat least the respective one of the aggregated accounts held in each of aplurality of the deposit institutions, whether the respective one of theaggregated accounts has a no-withdrawal designation indicating suchaggregated account is not to receive withdrawals for one or moresub-periods of time; (4) selecting, by the one or more computers, atleast one aggregated account in one of the deposit institutions fromamong the deposit institutions to which to deposit or to withdraw funds,while avoiding withdrawing funds for the respective sub-period of timefrom one or more of the other aggregated accounts based at least in parton whether a no-withdrawal designation is determined for the one or moreother respective aggregated accounts; (5) allocating, by the one or morecomputers, client funds of a plurality of the respective client accountsamong a plurality of the aggregated accounts based on the selecting stepso that the one or more of the aggregated accounts that has ano-withdrawal designation has a net balance of funds that is notdecreased for the sub-period in time, the allocating further comprising:(i) obtaining a holdback amount, by the one or more computers, to beapplied at least in part to at least one net transaction amount of fundsto be withdrawn from, or at least one net transaction amount of funds tobe deposited to, at least one of the aggregated accounts for transactiondata for a before-cutoff sub-period of time that is before the cutofftime; (ii) determining, by the one or more computers, for at least oneof the net transaction amount of funds to be withdrawn from, or at leastone of the net transaction amount of funds to be deposited to, at leastone of the aggregated accounts, whether the sub-period of time for thattransaction data occurred after the cutoff time; (iii) allocating, bythe one or more computers, at least one of the respective nettransaction amount of funds for a respective one of the aggregatedaccounts while holding back an amount of funds based at least in part onthe holdback amount of funds, if the sub-period of time for thetransaction data resulting in the net transaction amount of funds is abefore-cutoff sub-period of time; (6) generating instructions towithdraw funds from or depositing or having deposited funds to the atleast one of the aggregated accounts based on the allocating step, thisstep comprising at least one of the following steps: (i) generating oneor more instructions, by the one or more computers, to transfer anamount of funds to satisfy at least in part a net transaction amountthat is negative and is for transaction data after the cutoff time, fromthe holdback amount of funds; or (ii) generating one or moreinstructions, by the one or more computers, to transfer an amount offunds to satisfy a net transaction amount for transaction data after thecutoff time; and updating, by the one or more computers, the one or moredatabases with information on which of the deposit institutions areholding funds of a plurality of the client accounts.

In a further embodiment, the respective net transaction amount isnegative so that there is a net withdrawal from the respectiveaggregated account, and further comprising obtaining the holdback amountof funds by the allocating step increasing an amount of the netwithdrawal for the respective aggregated account at the depositinstitution by the holdback amount.

In a further embodiment, the respective net transaction amount ispositive so that there is a net credit to the respective aggregatedaccount, and further comprising obtaining the holdback amount of fundsby the allocating step decreasing an amount of the net credit for therespective aggregated account at the deposit institution by the holdbackamount.

In a further embodiment, the obtaining step comprises receiving, by theone or more computers, the holdback amount.

In a further embodiment, the obtaining step comprises calculating, bythe one or more computers, the holdback amount.

In a further embodiment, a step is provided of maintaining, by the oneor more computers, interest records for one or more of the clientaccounts.

In a further embodiment, a step is provided of tracking, by the one ormore computers, interest transactions posted to one or more of theclient accounts.

In a further embodiment, a step is provided of obtaining, by the one ormore computers, a daily activity and a daily ending position for each ofa plurality of the deposit institution.

In a further embodiment, a step is provided of performing, by the one ormore computers, an automatic reconciliation process using the dailyactivity and the daily ending position for the deposit institutions.

In a further embodiment, for each aggregated account with ano-withdrawal designation, the step of allocating further comprisesoffsetting, by the one or more computers, any withdrawal from thisaggregated account with deposits from another aggregated account thatdoes not have a no-withdrawal designation and is in a different one ofthe deposit institutions.

In a further embodiment, a step is provided of selecting, by the one ormore computers, another aggregated account based, at least in part, onwhether it is associated in the one or more databases with a samefinancial entity as the aggregated account with the no-withdrawaldesignation.

In a yet further embodiment, a system is disclosed for managing aplurality of FDIC-insured and interest-bearing aggregated accounts heldin a plurality of deposit institutions, with each of the depositinstitutions holding at least one of the aggregated accounts, each ofthe aggregated accounts holding funds of a plurality of client accounts,comprising: one or more computers comprising the following components: acomponent for accessing one or more databases comprising: (1) aggregatedaccount information for a plurality of the FDIC-insured andinterest-bearing aggregated accounts held in the deposit institutions,wherein funds from client accounts of a plurality of clients areaggregated with funds of other client accounts in the aggregatedaccounts held in the deposit institutions, wherein each of therespective deposit institutions holds one or more of the aggregatedaccounts; and (2) client account information for each of the respectiveclient accounts comprising: (i) a respective client asset balance in therespective client account; (ii) transaction data for the respectiveclient account; and (iii) a respective balance of funds from therespective client account held in each of one or more of theFDIC-insured and interest-bearing aggregated accounts holding funds ofthe respective client account; and a component for determining depositsto and withdrawals from the aggregated accounts, the component fordetermining comprising: (1) a component for accessing transaction datacomprising deposit amounts to and/or withdrawal amounts from one or moreof the client accounts for a sub-period of time; (2) a component forcalculating for each of a respective one or more of the aggregatedaccounts held in each of a plurality of the deposit institutions, afirst net transaction amount with respect to the respective aggregatedaccount based on transaction data for the sub-period of time for clientaccounts with funds held therein; (3) a component for determining for atleast the respective one of the aggregated accounts held in each of aplurality of the deposit institutions, whether the respective one of theaggregated accounts has a no-withdrawal designation indicating suchaggregated account is not to receive withdrawals for one or moresub-periods of time; (4) a component for selecting at least oneaggregated account in one of the deposit institutions from among thedeposit institutions to which to deposit or to withdraw funds, whileavoiding withdrawing funds for the respective sub-period of time fromone or more of the other aggregated accounts based at least in part onwhether a no-withdrawal designation is determined for the one or moreother respective aggregated accounts; (5) a component for allocatingclient funds of a plurality of the respective client accounts among aplurality of the aggregated accounts based on the selecting step so thatthe one or more of the aggregated accounts that has a no-withdrawaldesignation has a net balance of funds that is not decreased for thesub-period in time, the allocating further comprising: (i) obtaining aholdback amount to be applied at least in part to at least one nettransaction amount of funds to be withdrawn from, or at least one nettransaction amount of funds to be deposited to, at least one of theaggregated accounts for transaction data for a before-cutoff sub-periodof time that is before the cutoff time; for transaction data for asub-period of time before the cutoff time; (ii) determining for at leastone of the net transaction amount of funds to be withdrawn from, or atleast one of the net transaction amount of funds to be deposited to, atleast one of the aggregated accounts, whether the sub-period of time forthat transaction data occurred after the cutoff time; (iii) allocatingat least one of the respective net transaction amount of funds for arespective one of the aggregated accounts while holding back an amountof funds based at least in part on the holdback amount of funds, if thesub-period of time for the transaction data resulting in the nettransaction amount of funds is a before-cutoff sub-period of time; (6) acomponent for generating instructions to withdraw funds from ordepositing or having deposited funds to the at least one of theaggregated accounts based on the allocating component, the component forgenerating instructions comprising at least the following components:(i) a component for generating one or more instructions to transfer anamount of funds to satisfy at least in part a net transaction amountthat is negative and is for transaction data after the cutoff time, fromthe holdback amount of funds; and (ii) a component for generating one ormore instructions to transfer an amount of funds to satisfy a nettransaction amount for transaction data after the cutoff time; and acomponent for updating the one or more databases with information onwhich of the deposit institutions are holding funds of a plurality ofthe client accounts.

In a yet further embodiment, a program product is disclosed for managinga plurality of FDIC-insured and interest-bearing aggregated accountsheld in a plurality of deposit institutions, with each of the depositinstitutions holding at least one of the aggregated accounts, each ofthe aggregated accounts holding funds of a plurality of client accounts,comprising: one or more computer-readable media having computer readableprogram code embodied therein or among them, to be executed by acomputer, the computer readable program code comprising: program codefor accessing, by one or more computers, one or more databasescomprising: (1) aggregated account information for a plurality of theFDIC-insured and interest-bearing aggregated accounts held in thedeposit institutions, wherein funds from client accounts of a pluralityof clients are aggregated with funds of other client accounts in theaggregated accounts held in the deposit institutions, wherein each ofthe respective deposit institutions holds one or more of the aggregatedaccounts; and (2) client account information for each of the respectiveclient accounts comprising: (i) a respective client asset balance in therespective client account; (ii) transaction data for the respectiveclient account; and (iii) a respective balance of funds from therespective client account held in each of one or more of theFDIC-insured and interest-bearing aggregated accounts holding funds ofthe respective client account; and program code for determining, by oneor more computers, deposits to and withdrawals from the aggregatedaccounts, the program code for determining comprising: (1) program codefor accessing, by the one or more computers, transaction data comprisingdeposit amounts to and/or withdrawal amounts from one or more of theclient accounts for a sub-period of time; (2) program code forcalculating, by the one or more computers, for each of a respective oneor more of the aggregated accounts held in each of a plurality of thedeposit institutions, a first net transaction amount with respect to therespective aggregated account based on transaction data for thesub-period of time for client accounts with funds held therein; (3)program code for determining, by the one or more computers, for at leastthe respective one of the aggregated accounts held in each of aplurality of the deposit institutions, whether the respective one of theaggregated accounts has a no-withdrawal designation indicating suchaggregated account is not to receive withdrawals for one or moresub-periods of time; (4) program code for selecting, by the one or morecomputers, at least one aggregated account in one of the depositinstitutions from among the deposit institutions to which to deposit orto withdraw funds, while avoiding withdrawing funds for the respectivesub-period of time from one or more of the other aggregated accountsbased at least in part on whether a no-withdrawal designation isdetermined for the one or more other respective aggregated accounts; (5)program code for allocating, by the one or more computers, client fundsof a plurality of the respective client accounts among a plurality ofthe aggregated accounts based on the selecting step so that the one ormore of the aggregated accounts that has a no-withdrawal designation hasa net balance of funds that is not decreased for the sub-period in time,the program code for allocating further comprising: (i) program code forobtaining a holdback amount, by the one or more computers, to be appliedat least in part to at least one net transaction amount of funds to bewithdrawn from, or at least one net transaction amount of funds to bedeposited to, at least one of the aggregated accounts for transactiondata for a before-cutoff sub-period of time that is before the cutofftime; (ii) program code for determining, by the one or more computers,for at least one of the net transaction amount of funds to be withdrawnfrom, or at least one of the net transaction amount of funds to bedeposited to, at least one of the aggregated accounts, whether thesub-period of time for that transaction data occurred after the cutofftime; (iii) program code for allocating, by the one or more computers,at least one of the respective net transaction amount of funds for arespective one of the aggregated accounts while holding back an amountof funds based at least in part on the holdback amount of funds, if thesub-period of time for the transaction data resulting in the nettransaction amount of funds is a before-cutoff sub-period of time; (6)program code for generating instructions to withdraw funds from ordepositing or having deposited funds to the at least one of theaggregated accounts based on operation of the allocating program code,the program code for generating instructions comprising: (i) programcode for generating one or more instructions, by the one or morecomputers, to transfer an amount of funds to satisfy at least in part anet transaction amount that is negative and is for transaction dataafter the cutoff time, from the holdback amount of funds; and (ii)program code for generating one or more instructions, by the one or morecomputers, to transfer an amount of funds to satisfy a net transactionamount for transaction data after the cutoff time; and program code forupdating, by the one or more computers, the one or more databases withinformation on which of the deposit institutions are holding funds of aplurality of the client accounts.

According to a further embodiment of the present invention, a method isprovided for managing a group of aggregated accounts, each aggregatedaccount held in a different one of a plurality of deposit institutions,each of the aggregated accounts associated with at least one financialentity and holding funds of a plurality of clients of the at least onefinancial entity, each of the clients having a client asset balance in arespective client account associated with the at least one financialentity, comprising: (1) allocating fund deposits to and fund withdrawalsfrom the aggregated accounts, the step of allocating comprising: (a)calculating an aggregated transaction amount based on a total nettransaction from among the plurality of the client accounts during aperiod of time; (b) selecting at least one aggregated account from amongthe group of aggregated accounts in the different deposit institutionsto which to deposit or to withdraw funds based, at least in part, so asto avoid withdrawing funds from or depositing funds to at least adifferent one of the aggregated accounts in the group; and (2)withdrawing funds from or depositing funds to the at least one of theaggregated accounts based on the allocation.

In a further embodiment, the selecting step is performed at least inpart by determining a relationship between a respective amount of netassets in one of the at least one of the aggregated accounts in thegroup of aggregated accounts and a respective minimum deposit cap.

In a further embodiment, the selecting step is performed at least inpart by determining a relationship between respective net assets in eachof a plurality of the aggregated accounts and a respective minimumdeposit cap associated with each of the plurality of the respectiveaggregated accounts.

In a further embodiment, the selecting step selects a plurality of theaggregated accounts from among the group of aggregated accounts to whichto deposit or to withdraw funds.

In a further embodiment, the selecting step further selects depositinstitutions based, at least in part, on determining a relationshipbetween the respective amount of net assets in the at least oneaggregated account held at one of the financial entities of the groupand both the respective minimum deposit cap and a respective maximumdeposit cap.

In another embodiment, the selecting step selects deposit institutionsbased, at least in part, on determining a relationship between therespective amount of net assets in each of the plurality of aggregatedaccounts and both the respective minimum deposit cap and a respectivemaximum deposit cap.

In a further embodiment, the selecting step selects a plurality of theaggregated accounts from among the group of aggregated accounts to whichto deposit or to withdraw funds.

In a further embodiment, the allocating step comprises allocating arespective amount to one of the at least one aggregated accounts basedat least in part on the relationship between the respective amount ofnet assets in the one aggregated account held at that depositinstitution and the respective minimum deposit cap.

In a further embodiment, the allocating respective amount step allocatesan amount to the one aggregated account based, at least in part, on therelationship between the respective amount of net assets in the at leastone aggregated account and both the respective minimum deposit cap andthe respective maximum deposit cap for that aggregated account in thatdeposit institution.

In a further embodiment, the relationship is whether the amount of netassets in the at least one aggregated account is below the respectiveminimum cap.

In a further embodiment, the relationship comprises whether the amountof net assets in the one aggregated account held at that depositinstitution is below the respective minimum cap, and further comprises,if these net assets are above the respective minimum cap, whether theamount of net assets in the aggregated account held at that depositinstitution is below the respective maximum cap.

In a further embodiment, the relationship is how far the net assets inthe one aggregated account held at that respective deposit institutionare below or above the respective minimum cap.

In a further embodiment, the relationship comprises how far the amountof net assets in the one aggregated account held at that depositinstitution is below the respective minimum cap, and further comprises,if these net assets are above the minimum cap, how far the net assets inthe aggregated account held at that deposit institution is below therespective maximum cap.

In a further embodiment, the allocating step comprises selecting the atleast one deposit institution to which to deposit or to withdraw fundsbased, at least in part, on one or more rules.

In a further embodiment, one rule of the one or more rules compriseslimiting a number of withdrawals from each of the aggregated accounts inthe group over a time period to a predetermined number.

In another embodiment, the allocating amounts step comprises allocatingthe respective amounts to the at least one aggregated account based, atleast in part, on one or more rules.

In a further embodiment, a step is provided of allocating client assetbalances in the client accounts among a plurality of the aggregatedaccounts in the group to match the allocation of funds.

In a further embodiment, a step is provided of allocating client assetbalances in the client accounts associated with the one financial entityamong one or more of the aggregated accounts based, at least in part, onone or more rules.

In a further embodiment, one rule of the one or more rules compriseslimiting net assets of a client in at least one of the aggregatedaccounts in the group held at a given deposit institution to less than apredetermined amount.

In a further embodiment, the allocating client asset balances in theclient accounts among a plurality of the aggregated accounts isperformed only one time per day to substantially match the most recentallocation of funds.

In a further embodiment, a step is provided of allocating client assetbalances in the client accounts associated with the one financial entityamong one or more of the aggregated accounts based, at least in part, onone or more rules.

In a further embodiment, one rule of the one or more rules compriseslimiting net assets of a client in at least one of the aggregatedaccounts in the group held at a given deposit institution to less than apredetermined amount.

In a further embodiment, the allocating client asset balances in theclient accounts among a plurality of the aggregated accounts isperformed only one time per day to substantially match the most recentallocation of funds.

In a further embodiment, a step is provided of allocating client assetbalances in the client accounts among a plurality of the aggregatedaccounts in the group to match the allocation of funds.

In a further embodiment, a step is provided of allocating client assetbalances in the client accounts associated with the one financial entityamong one or more of the aggregated accounts based, at least in part, onone or more rules.

In a further embodiment, the calculating an aggregated transactionamount comprises: receiving a sweep file associated with the at leastone financial entity, the sweep file comprising fund deposits and/orfund withdrawals from a plurality of the client accounts associated withthe at least one financial entity; posting the fund deposits and/or thefund withdrawals and any other instructions in said sweep fileassociated with the plurality of client accounts of the at least onefinancial entity; and determining the total net transaction for thesweep file.

In a further embodiment, the minimum cap is a cap negotiated with thedepository institution.

In a further embodiment, at least one of the aggregated accounts held atone of the deposit institutions associated with the at least onefinancial entity has its respective maximum deposit cap set equal to itsrespective minimum deposit cap, and wherein the step of selectingfurther comprises by-passing withdrawals and deposits of funds for theat least one aggregated account that has its respective maximum depositcap set equal to its respective minimum deposit cap if the net assetsfor this aggregated account are substantially equal to or greater thanthe minimum cap for that aggregated account.

In a further embodiment, for each aggregated account in which themaximum deposit cap is equal to the minimum deposit cap and the netassets are substantially equal to the minimum or the maximum depositcap, the step of allocating further comprises offsetting withdrawalsfrom this aggregated account with deposits from another aggregatedaccount associated with the at least one financial entity held at adifferent deposit institution in which its respective maximum depositcap is not equal to its respective minimum deposit cap.

In a further embodiment, the plurality of client accounts is associatedwith a program, and wherein the step of withdrawing funds furtherdepends on predefined program rules associated with the program, thepredefined program rules comprising rules relating to one or more of thefollowing: level of FDIC insurance provided by the program, total clientaccount balance, the one or more deposit institutions attached to theclient account and the client account balance at each depositinstitution, and whether or not the client has chosen to opt out of oneor more of the deposit institutions.

In a further embodiment, the step of allocating comprises a step of, forthe at least one financial entity, reporting information regarding a nettransaction activity associated with the client accounts of the at leastone financial entity.

In a further embodiment, the step of reporting comprises generating adeposit institution allocation report comprising information regardingone or more of the following: an amount of the net transaction activityrequired for the corresponding deposit institution, and a reason for thenet transaction activity required for the corresponding depositinstitution.

In a further embodiment, the step of allocating comprises a step ofapproving the information regarding the net transaction activity.

In a further embodiment, the step of approving comprises collectingreported financial institution periodic activity data from eachfinancial institution; and reconciling inconsistencies between reporteddeposit institution periodic activity data and observed depositinstitution periodic activity data.

In a further embodiment, the step of allocating comprises a step ofnotifying each deposit institution of any allocation thereto.

In a further embodiment, for each deposit institution where a withdrawalallocation is to be made, the step of notifying comprises steps ofgenerating and sending a message to the deposit institution in one ofthe following manners: in person, by mail, by automated teller machine,and using the telephone and distributing by mail and messenger service.

In a further embodiment, the selecting step determines if there is adata field that indicates whether to avoid withdrawing funds from ordepositing funds to the different one of the aggregated accounts.

In a further embodiment, a system is provided for managing a group ofaggregated accounts, each aggregated account held in a different one ofa plurality of deposit institutions, each of the aggregated accountsassociated with at least one financial entity and holding funds of aplurality of clients of the at least one financial entity, each of theclients having a client asset balance in a respective client accountassociated with the at least one financial entity, comprising: adatabase maintaining records of assets in the group of aggregatedaccounts; and one or more processors operably connected to the databasefor implementing the following components: (1) a deposit institutionallocation system that allocates fund deposits to and fund withdrawalsfrom the aggregated accounts, comprising: (a) a net transaction activitymonitor that calculates an aggregated transaction amount based on atotal net transaction of the plurality of the client accounts during aperiod of time; (b) a selection component for selecting at least oneaggregated account in the group from among the group of aggregatedaccounts in the different deposit institutions to which to deposit or towithdraw funds based, at least in part, so as to avoid withdrawing fundsfrom or depositing funds to at least a different one of the aggregatedaccounts in the group; and (2) a withdrawal component for withdrawingfunds from or depositing funds to the at least one of the aggregatedaccounts based on the allocation.

In a further embodiment, the withdrawal component comprises a messagegenerator that generates one or more messages for facilitatingwithdrawal of funds from or deposit of funds to one or more of theaggregated accounts their respective associated deposit institutions.

In a further embodiment, a program product is provided for managing agroup of aggregated accounts, each aggregated account held in adifferent one of a plurality of deposit institutions, each of theaggregated accounts associated with at least one financial entity andholding funds of a plurality of clients of the at least one financialentity, each of the clients having a client asset balance in arespective client account associated with the at least one financialentity, comprising: one or more computer usable media having computerreadable program code embodied therein or among them, to be executed bya computer, the computer readable program code comprising: (1) programcode for allocating fund deposits to and fund withdrawals from theaggregated accounts, the step of allocating comprising: (a) calculatingan aggregated transaction amount based on a total net transaction fromamong the plurality of the client accounts during a period of time; (b)selecting at least one aggregated account from among the group ofaggregated accounts in the different deposit institutions to which todeposit or to withdraw funds based, at least in part, so as to avoidwithdrawing funds from or depositing funds to at least a different oneof the aggregated accounts in the group; and (2) program code forwithdrawing funds from or depositing funds to the at least one of theaggregated accounts based on the allocation.

These and other features of this invention are described in, or areapparent from, the following detailed description of various exemplaryembodiments of this invention

BRIEF DESCRIPTION OF THE DRAWINGS

Various exemplary embodiments of this invention will be described indetail, with reference to the following figures, wherein:

FIG. 1 is a block diagram of a system for managing aggregated accountsaccording to an exemplary embodiment of the present invention;

FIGS. 2A and 2B are flowcharts for one embodiment of an allocationprocess in accordance with the present invention;

FIG. 3 is a flow chart illustrating a deposit institution finalallocation process according to an exemplary embodiment of the presentinvention;

FIG. 4 is a flow chart illustrating a reconciliation process accordingto an exemplary embodiment of the present invention;

FIG. 5 is a flow chart illustrating a deposit institution interimallocation process according to an exemplary embodiment of the presentinvention;

FIG. 6 is a flow chart illustrating a deposit institution finalallocation process according to another exemplary embodiment of thepresent invention;

FIG. 7 shows a month-to-date (MTD) interest accrual process executed bythe management institution according to an exemplary embodiment of thepresent invention;

FIG. 8 is a flow chart illustrating a prepaid interest process performedby the management institution according to an exemplary embodiment ofthe present invention; and

FIG. 9 is a block diagram showing an Internet-based aggregated accountmanagement system according to an exemplary embodiment of the presentinvention.

DETAILED DESCRIPTION OF PREFERRED EMBODIMENTS

The following terms are used with the indicated meanings:

-   -   “account” comprises transaction accounts in which funds can be        deposited, including without limitation, demand deposit accounts        (DDA's), money market deposit accounts (MMDA's), NOW accounts,        all forms of corporate accounts, and any other type of accounts        that can be held by an entity.    -   “aggregated account” comprises an account at a deposit        institution for holding funds for a plurality of clients from        one or more financial entities. The aggregated account can be a        segregated account that only holds the funds for a plurality of        clients of a single financial entity that may be self-clearing.        Alternatively, the aggregated account can hold the assets for a        plurality of clients of a plurality of financial entities which        may utilize the clearing services provided by a self-clearing        financial entity or a management institution, depending upon the        program.    -   “financial entity” is intended to be interpreted broadly to        cover a variety of entities offering programs such as brokerage        advisors, investment advisors, broker dealers, savings        institutions, credit unions, banks, management institutions and        the like. A financial entity may maintain one or more client        accounts on behalf of one or more clients for receiving funds        deposited thereto, and for debiting checks or other financial        instruments drawn against that account.    -   “customer entity” or “customer” collectively refer to those        financial entities whose clients have an ownership interest        directly or indirectly in the funds in one or more aggregated        accounts.    -   “client of a customer entity” or “client” collectively refer to        the ownership interests that have deposited funds at the        financial entities, for example, in the form of individual        accounts, joint accounts, trust accounts, ERISA accounts, non-US        accounts, and any of a variety of other programs. Example client        types include individuals, profit or non-profit corporations,        limited liability corporations, partnerships or other forms of        business entities, government agencies, and municipalities.        There is no limitation on the types of accounts that can        participate in the Program.

The present invention relates, in one embodiment, to a system and methodfor managing deposits and withdrawals from among a plurality ofaggregated accounts held at a plurality of deposit institutions in orderto obtain FDIC insurance above the limit set for individual accounts. Ina further embodiment, the invention relates to a system and method formanaging the transfer of client funds received from one or morefinancial entities by controlling the deposits to and withdrawals fromamong a plurality of aggregated accounts held at a plurality of depositinstitutions in order to obtain certain results. In one embodiment, thedeposits and withdrawals are managed to strive to obtain balances in oneor more aggregated accounts in one or more destination depositinstitutions associated with a financial entity(s) or program that areabove the respective minimum caps for the respective deposit accounts atthe different respective deposit institutions. In a further embodiment,the deposits and withdrawals are managed to strive to obtain balances inone or more aggregated accounts held in one or more destination depositinstitutions associated with a financial entity(s) or program that fallbetween respective min and max caps for each respective aggregatedaccount at the respective deposit institutions. In yet a furtherembodiment, the deposits and withdrawals are managed to strive to obtainbalances in a plurality of aggregated accounts associated with differentprograms but in the same deposit institution, but managed by the samemanagement institution, above a minimum cap associated with the depositinstitution. In a further embodiment, the deposits and withdrawals aremanaged to strive to obtain balances, that once reached in one or moreaggregated account, are held stable with limited or no account activity.

In yet a further embodiment, the deposits and withdrawals from thedeposit accounts are managed to ensure that no more than a predeterminedamount, such as for example, $100,000, associated with a given client isheld in any one deposit institution. In a yet further embodiment, thetransfers of funds from customer financial entities through a controloperating account for one or more aggregated accounts uses an allocationof client funds among clients of the financial entity to ensure that allclient balances residing in the control operating account become insuredwithin a short period after receipt into the control operating account,even if over the FDIC insurance limit for one or more clients. In afurther embodiment, the deposits to and withdrawals from the aggregatedaccounts are managed to obtain a hold back amount to be used to coverlate transactions after the closing time. In yet a further embodiment, apre-paid interest is accumulated and used to fund interest payments forclient accounts being closed in mid-period, before the monthly orquarterly distribution of interest by the one or more aggregatedaccounts in deposit institutions holding the client's funds. In yet afurther embodiment, a reconciliation process ensures that clientbalances reflected in the records maintained by financial entities fortheir participating clients are equal to the client balances reflectedin a management institution's records for those same participatingclients, and that aggregate balances maintained in aggregated accountsin respective deposit institutions are in balance with an aggregatebalance of the individual client balances reflected in the managementinstitution records and the financial entity records. On a daily basisor other periodic basis, this reconciliation process in one embodimentincludes comparing the aggregate balances for clients maintained by themanagement institution to the position maintained at the financialentity for each of its clients, comparing the aggregate balance at eachdeposit institution maintained by the management institution to theactual aggregate balance at each deposit institution, and in addition acontrol operating account in an intermediate bank used for facilitatingfund transfers is reconciled to ensure the correct money movements asspecified by the various deposit institution allocations has takenplace. In yet a further embodiment, the minimum and/or maximum caps arevaried to manage the amount of net assets in an affiliated depositinstitution.

FIG. 1 is a block diagram of a system for allocating deposits to andwithdrawals from aggregated accounts, generally designated by referencenumber 1, according to an exemplary embodiment of the present invention.The system 1 includes a number of financial entities FE1-FEn, eachmanaging one or more programs, such as insured deposit products, forexample. Each program may include one or more insured deposit products,each having different attributes, such as insurance level, differenttier options and rates paid and services. In one embodiment, the ratespaid may be determined by such factors as the balance in the client'sinsured account, or can be determined by the total value of the client'sbrokerage account, or determined by the total value of a group ofaccounts for a particular household together, or determined byrelationship pricing based on the number of products a client usesthough a financial entity or sister entities, to name a few. Eachfinancial entity FE1-FEn may have a plurality of clients C1-Cm thatinvest in particular products that make up part of a particular program.The clients C1-Cm may be individuals or corporations or any other formof entity. Thus, for example, a financial entity FE1 may manage a numberof programs designated in FIG. 1 as PROGRAM FE1-1, PROGRAM FE1-2, . . .PROGRAM FE1-p, where each client C1-Cm of the financial entity FE1invests in at least one of the products under at least one of theprograms PROGRAM FE1-1-PROGRAM FE1-p. Examples of different kinds ofprograms that may be offered, include a program with cash managementservices, a program for high net worth individuals with a higher minimumbalance required, a program paying a lower rate and offering moreservices, a no frills program with a higher rate and no services,however for a fee the client could get other services, to name a few.

The system 1 also includes a number of deposit institutions DI1-DIq,into which funds are deposited. Deposit institutions DI1-DIq may be, forexample, banks or credit unions, or other types of deposit institutions.Preferably, at least some of deposit institutions DI1-DIq are FDICinsured. However, not all deposit institutions need be FDIC insured. Forexample, certain PROGRAMS can also default to a money fund, or otheruninsured deposit account, if the client's account balance is over theFDIC insurance limit for that PROGRAM. Preferably, at least some ofdeposit institutions DI1-DIq are FDIC insured. While the basic federalinsurance amount is currently $100,000, more than $100,000 of coveragecan be obtained if funds are maintained in different ownershipcategories, according to the FDIC. For example, coverage of up to$100,000 can be obtained for individual accounts at a depositinstitution, another $100,000 for each share of joint accounts at thesame deposit institution, and yet another $250,000 for retirementaccounts held at the same deposit institution. Moreover, by depositingfunds at more than one FDIC insured deposit institution, multiples of$100,000 of coverage can become protected by federal insurance. Forexample, if deposits are made to 10 FDIC insured deposit institutions,with no more than $100,000 for each ownership category deposited in eachof said 10 FDIC deposit institutions, then $1 million of effectivefederal insurance can be obtained for each ownership category.

In one embodiment, a financial entity, or a management institution 10,acting as agent for the financial entity (to be discussed later) managesin each deposit institution (e.g., bank or saving institution) anaggregate money market deposit account (MMDA) and an aggregate demanddeposit account (DDA), both being in the identical name of the financialentity, or its agent (referred to herein as an “MMDA-DDA pair”). Inresponse to client deposit and withdrawal transactions, the financialentity or its agent initiates transfers of funds between the MMDA-DDApairs, so that if the aggregate deposits of all clients for thatfinancial institution or PROGRAM exceed the aggregate client withdrawals(net client credit), then all or some of the funds may be depositeddirectly in the MMDA at the deposit institution or, in an alternativeembodiment, by way of the DDA in the MMDA-DDA pair. Conversely, ifclient withdrawals for all clients of that financial institution orProgram exceed client deposits (net client debit), then the depositinstitution may be instructed by messenger or otherwise to transferfunds from the aggregate MMDA to the DDA.

As noted, the MMDAs are interest-bearing, insured deposit accounts,collectively in which the managed balances for clients are deposited.The DDAs, which are deposit accounts permitting an unlimited number ofdeposits and withdrawals, serve to facilitate the exchange of fundsbetween the MMDAs, the deposit institutions, and sources of clienttransactions (referred to herein as “transaction sources”). If thefinancial entity or the management institution 10 determines that it isnecessary to move funds from a particular MMDA (at a particular depositinstitution), it first causes a messenger or otherwise to have thesefunds transferred from the MMDA to the DDA member of the MMDA-DDA pair,and second causes the funds in the DDA to be moved to the financialentity's or its agent's own account or accounts. Then, from theseaccounts, funds may be further transferred to a third party, such as atransaction source or a customer financial entity (preferably byelectronic or other automatic means). If funds are to be moved into aparticular MMDA, the agent either may have them deposited into theassociated DDA and then moved into the MMDA, or may have them depositeddirectly into the MMDA. The agent database is updated to reflect thesefunds transfers.

While in a preferred embodiment, a separate account or set of accounts,e.g., money market deposit account (MMDA) and demand deposit account(DDA), are set up for each program for each financial entity, and undercertain embodiments of the present invention different programs of thesame financial entity or different financial entities can be commingledand aggregated. Note that a financial entity does not have to set up aseparate money market deposit account (MMDA) and associated demanddeposit account (DDA) for each PROGRAM at the deposit institution, i.e.,the same MMDA and/or DDA can be used across several PROGRAMS ifregistered, e.g., in the name of and offered by the same self clearingfinancial entity. Similarly, a single MMDA or other type of account canbe set up at each deposit institution, or more than two accounts can beset up at each deposit institution. If a financial entity is a clearingfirm that provides clearing services for other financial entities(correspondents), it is not necessary for the correspondents to set up asegregated MMDA and DDA for their respective Programs. Note that it isnot necessary for each financial entity, whether a bank or other entity,to setup segregated aggregated accounts at the deposit institution.Rather a management institution 10 could act as an agent for a group ofsuch financial entities so that assets for several financial entitybanks or other entities can be held in the same MMDA and DDA registeredin the name of the management institution at each deposit institutionDI1-DIq. But if the same PROGRAM is being offered by different financialentities, separate accounts are used for each financial entity that is aself clearing financial entity. Note that a self clearing financialentity is defined as a financial entity that provides clearing servicesfor his clients only and/or provides clearing services for otherfinancial entities that are not self clearing but correspondents of theself clearing financial entity. The deposits for the clients of thecorrespondent financial entities would be held in the self clearingfinancial entity's MMDA that is held in a deposit institution associatedwith that self clearing financial entity. Thus, for example, if depositinstitution DI1 participates in three Programs each run by a differentself clearing financial entity, the deposit institution DI1 may havethree segregated aggregated accounts, each aggregated account associatedwith a different self clearing financial entity. The segregatedaggregated accounts are preferably money market deposit accounts (MMDAs)registered in the name of the financial entity that manages the programassociated with the MMDA. However, any other suitable investmentaccounts may be used, such as NOW accounts for individuals, or DDA's.Moreover, more than one type of account could be used, e.g., anaggregated MMDA and an aggregated DDA at each deposit institution. Insome embodiments as noted above, a management institution 10 may beprovided within the system 1 that could maintain account information foreach of the financial entities (FE1, FE2, . . . FEn) and others in adatabase within its own system or have such a database maintained forits use.

In embodiments comprising a management institution, the managementinstitution 10 is configured to allocate and manage deposits,withdrawals and other transactions relating to each of the accounts ineach of the deposit institutions DI1-DIq. Thus, the managementinstitution tracks the net activity for the aggregated accountsmaintained by the financial entity or the management institution 10itself at the deposit institutions DI1-DIq based on information sentfrom the financial entities FE1-FEn to the management institution 10and/or from other appropriate sources via contract or otherwise. Themanagement institution 10 maintains records or has maintained for itrecords on each financial entity and their respective clients with fundsin deposit institutions managed by the management institution 10,whether the financial entity is self clearing or not. Thus, in oneembodiment, the management institution 10 maintains accounts records forall of the client accounts of the financial entities with funds managedby the management institution 10. As explained more fully below, themanagement institution 10 may automatically generate reports, forexample in the form of e-mail messages, text messages, faxes, etc.,advising the financial entities FE1-FEn of the day's net activity for aspecific account in a specific deposit institution DIq holding funds forthat financial entity, and/or activity in one or more client accounts ofthat financial entity. If more than one account is maintained at adeposit institution DI1-DIq, each account may be settled separately. Themanagement institution 10 maintains or has maintained for it computersoftware and/or hardware 20 located at the management institution site,or at a remote site that is in communication with the managementinstitution 10, that maintains databases and other program functions totrack the activities in the various aggregated accounts in each depositinstitution DI1-DIq. Examples of such computer software and/or hardwarewill be discussed below.

An intermediary bank 30 may be incorporated as part of the system 1 tooversee and facilitate the transactions to and from the variousaggregated accounts based on management institution 10 allocations. Theintermediary bank 30 may either be the same as or separate from themanagement institution 10. In embodiments where the managementinstitution 10 and the intermediary bank 30 are separate entities, theymay be in substantially constant electronic communication. Theintermediary bank 30 includes one or more control operating accounts,for example, one control operating account per self clearing financialentity. In one embodiment, the management institution 10 also maintainsrecords of deposits, debits and balances for each client of a financialentity with funds in a control operating account, whether or not thatfinancial entity is a self clearing financial entity. At the end of aperiod of time, such as 2-4 hours, or a day, for example, the balance offunds in each of the control operating accounts at the intermediary bank30 are transferred to or from one or more of the deposit institutionsDI1-DIq. Note that in some embodiments where the self clearing FI's arenot banks, self clearing financial entities use the intermediary bank toexecute the wires, i.e., to send and receive wires/funds from thedeposit institutions.

According to various exemplary embodiments of the method of the presentinvention, each deposit institution DI1-DIq may be assigned a minimumdeposit cap (Min Cap), a maximum deposit cap (Max Cap), and an absolutecap (Absolute Cap). These caps are used to determine which depositinstitutions to select in an allocation process for a sweep file netdeposit or withdrawal, to be discussed below. These caps may remain thesame or be reset as appropriate.

“Min Cap” is the minimum deposit amount to be maintained either in agiven aggregated account at a destination deposit institution, or theminimum deposit amount to be maintained over a plurality of aggregatedaccounts at a destination deposit institution. In one embodiment, theminimum cap may be negotiated for an individual aggregate account at adeposit institution. If there is only one aggregate account at thedeposit institution, then this minimum pertains/is associated with theoverall deposit institution. In another embodiment, a managementinstitution may manage a plurality of different programs for itscustomer financial entities, with each different program having aplurality of destination deposit institutions for depositing fundsthereamong for that program or financial entity, wherein there may be anoverlap in the destination deposit institutions of the programs. Themanagement institution may then negotiate a minimum cap for the depositinstitution and split the minimum in its discretion between or amongdifferent aggregated accounts associated with the different programs atthe same deposit institution, and may alter that split on a real timebasis in its discretion. The minimum deposit cap can be set to zero orgreater. Accordingly, when allocating deposits to the depositinstitutions for a given financial entity and/or program, the allocationprocess will attempt to satisfy the minimum deposit cap associated withthe aggregated account for that financial entity and/or program at thedestination deposit institution. In an embodiment, the allocationprocess may allocate withdrawal of funds first from aggregated accountsheld in destination deposit institutions for that financial entityand/or program that have balances above their respective minimum depositcaps before it allocates withdrawal of funds from aggregated accountsheld in destination deposit institutions for that financial entityand/or program that are at or below their respective minimum depositcaps. Note that the Min Cap can be set using a variety of factors. Asnoted, the Min Cap at a deposit institution may be associated with asingle aggregated account of a financial entity and/or program. Thus,there may be a different respective Min Cap associated with eachdifferent financial entity with an aggregated account registered at thatdeposit institution. In an alternative embodiment, as noted above theMin Cap may be negotiated with a management institution 10 and may coverthe aggregate of all of the funds managed by that management institutionin aggregated accounts in that deposit institution. Thus, the managementinstitution would attempt to ensure that a certain stable minimum amountof total assets managed by the management institution were maintained atthat deposit institution

“Max Cap” is the maximum deposit amount that is to be maintained eitherin a given aggregated account at a destination deposit institution, orthe maximum deposit amount to be maintained over a plurality ofaggregated accounts, each associated with a different financial entityand/or program, at a destination deposit institution. The system willallocate deposits to respective aggregated accounts held in destinationdeposit institutions associated with the given financial entity and/orprogram that are below their respective Max Caps in an order that is setby rule for deposits. As with the Min Cap, the Max Cap may be oneassociated with a single aggregated account of a single financialentity. Alternatively, the Max Cap may be the aggregate dollar amountthe management institution 10 has approved for the particular depositinstitution to be split among a plurality of the aggregated accounts atthat deposit institution, or a lesser amount set by that depositinstitution for all of the accounts managed by the managementinstitution 10. In one embodiment, the Max Cap is set based on a creditpolicy. In this embodiment, before a deposit institution is added to thedeposit system of the present invention, the management institution 10performs a credit check and determines if the deposit institution meetspredetermined credit standards required by the financial entityassociated with that aggregated account, or alternatively required by amanagement institution credit policy. The management institution 10 thenapproves each deposit institution for a specific aggregate depositamount that is either associated with a given aggregated account at thedeposit institution, or with the overall deposit institution. Thisamount may be changed over time as circumstances require. The Max Capthus functions in this embodiment as a safety cap to ensure that thesystem does not allocate a deposit to an aggregated account at thedeposit institution that will push it over the Max Cap. As noted above,at times the deposit institution will request a lower deposit max cap.

“Absolute Cap” is the maximum deposit amount approved for either theaggregated account held in a destination deposit institution or for thedeposit institution itself. The absolute cap can be greater than orequal to the Max Cap. In situations where some or all of the aggregatedaccounts are at or over their respective Max Caps, the system mayallocate deposits to aggregated accounts or to deposit institutionsabove their respective Max Caps up to an Absolute Cap that should not beexceeded.

“Min=Max” if the min and max cap are equal, the aggregated account heldin the destination deposit institution is preferably bypassed by theallocation process once deposits from a given financial entity and/orprogram reach the level of the Min=Max Cap. It is intended that suchaggregated account held in the deposit institution, after its balance ofassets is at or above it Min Cap, shall have virtually no activity,other than the posting of interest at month end. The allocation processis designed to access the funds in these deposit institutions only ifthere is no other option. The allocation process automatically allowsfor minimal increases in the Max Caps at month end to allow for interestposting.

The management institution 10 is designed to run two allocationprocesses: a deposit institution allocation process, which allocatesfunds between/among the deposit institutions DI1-DIq, and a clientaccount balance allocation (to be discussed later). Referring to thedeposit institution allocation process, as explained in further detailbelow, this allocation process may serve one or more of severalpurposes, such as, for example, to maintain substantially stable depositfunds at a deposit institution by a financial entity or a managementinstitution by limiting deposit/withdrawal activity, to ensure thatactivity at the deposit institutions DI1-DIq complies with federalregulations such as FDIC regulations, to ensure compliance with a creditpolicy, and to insure compliance with specific rules set by the client,the Financial entity, or the branch.

With reference to the Min=Max cap parameter, the inventors haverecognized that deposit institutions are more willing to accept largedeposits if the management institution can guarantee substantialstability, with limited activity. If the account has substantialactivity it becomes a burden to the deposit institution. Minimization ofdeposit and withdrawal activity also makes reconciliation easier for thegiven financial entity maintaining funds in that deposit institution,since it is less costly if the financial entity and/or the managementinstitution 10 is not sending wires every day to every depositinstitution. Additionally, deposit/withdrawal minimization reduces thepeople resources needed to administer the various program.

In one embodiment, the deposit institution allocation process throughthe use of the Min Cap, may try to bring the balance in each aggregatedaccount at the deposit institutions up to at least a minimum depositcap. This minimum deposit cap may be negotiated based on a variety ofbusiness and banking concerns such as a minimum level of stable assetsmaintained by a financial entity or program or the managementinstitution at the depository institution, or the deposit institutionsoverall need for deposits to cover loan activity, and minimization ofdeposit/withdrawal activity, as discussed above.

As noted above, a maximum deposit cap, Max Cap, may also be set for theparticular deposit institution for various reasons including maintaininga credit policy, and controlling a level of activity in a transactionaccount.

The deposit institution allocation process may be set to minimizeactivity for that aggregated account after the balance in the accounthas reached the Min Cap, via by-passing withdrawals or credits to thatdeposit institution account by setting the minimum deposit cap equal tothe maximum deposit cap. Alternatively, other methods of flaggingaccounts that should remain unchanged as a result of net daily activitycan be used as the equivalent of setting the maximum deposit and theminimum deposit to be equal. For example, a flagging method may comprisedetermining if a flag such as a data field has been set in the system ora database indicates whether to avoid withdrawing funds from ordepositing funds to the different one of the aggregated accounts, or ifa rule is currently in operation to avoid withdrawing funds from ordepositing funds to the different one of the aggregated accounts. In oneembodiment, this data field or rule may be associated with a given day,set of days, week, etc., and may indicate that no withdrawals are totake place for the designated periods. Alternatively, such a flag orrule may indicate that no deposit or withdrawal activity is to takeplace with respect to the particular aggregated account. Note that inone embodiment, deposit and/or withdrawal activity may be directed to oraway from a given aggregated account using minimum caps, maximum caps,flags, rules, and various combinations thereof.

In some instances, the allocation process may not be able to by-pass aparticular deposit institution for withdrawals, such as when a by-passis in conflict with set parameters or a client has a withdrawal that isonly attached to the particular deposit institution. In this case, thedeposit institution allocation process will allow the withdrawal butattempt to replace the dollar amount withdrawn with an offsetting creditfrom one or more other clients of that financial entity with funds in anaggregated account at a different deposit institution associated withthat financial entity, and/or in some instances simply with funds fromanother deposit institution managed by the management institution 10.Accordingly, the process reallocates funds from one or more aggregatedaccounts attached to other deposit institutions. Thus, the net activityfor the deposit institution in which the withdrawal should have beenby-passed is at or about zero. The manner in which the depositinstitution allocation process is used to offset withdrawals fromaggregated accounts in which the minimum deposit cap is equal to themaximum deposit cap is demonstrated below with reference to Example 1:

Example 1

Aggregated account 1 associated with a given financial entity FE1 has awithdrawal of $50,000 from one client deposit account that is attachedonly to an aggregated account held in deposit institution DI2. Theminimum and maximum deposit caps associated with this aggregated accountof deposit institution DI1 are set to be equal and the balance in theaggregated account for deposit institution DI1 is at its Min=Max Cap.The minimum and maximum deposit caps of various other aggregatedaccounts held in other destination deposit institutions DI2, DI3, etc.associated with the given financial entity and/or program are not set tobe equal. The deposit institution allocation process looks at the netactivity for a received sweep file containing information on depositsand withdrawals from client accounts associated with the financialentity FE1 or its correspondents, and then determines which destinationdeposit institution or institutions associated with that financialentity FE1 to credit or debit depending upon the Min Caps, Max Caps, andother business rules established on the system for the client accounts,the aggregated accounts, the financial entities and the branches. Forthe above example, the $50,000 withdrawal is attached to one clientaccount and is designated for only the aggregated account for thatfinancial entity and/or program held in deposit institution DI1 and mustbe offset with a $50,000 credit comprising funds from one or moreaggregated accounts at one or more other destination depositinstitutions associated with the given financial entity and/or programthat do not have their Min Cap set equal to their Max Cap.

The second allocation process is the client account balance allocation.In this allocation, the client account balances arereshuffled/reallocated at some convenient time, to match the allocationto each deposit institution determined above. Thus, individual clientbalances for clients of a given financial entity FE1 or itscorrespondents can be shuffled/allocated to aggregated accounts indifferent deposit institutions. In one embodiment, the managementinstitution 10 reshuffles by following individual client accountbusiness rules, and financial entity and correspondent and branchbusiness rules (examples will provided below), and then the remainingclient accounts are reshuffled/allocated beginning with the clientaccount of the financial entity or correspondent (in the case ofco-mingled accounts) with the highest balance and progressing to theclient account with the lowest balance. The reallocation alternativelycan be performed from the lowest account balance to the highest accountbalance, or in any other convenient sequence. In the example, thedeposit institution DI1 with its aggregated account having its MinCap=and Max Cap would not be debited for the $50,000 client withdrawal.Rather, the client account balances would be reshuffled among depositinstitutions to allocate sufficient balances from other depositinstitutions associated with financial entity FE1 either directly orthrough a correspondent relationship to ensure that the aggregate amounton deposit remains unchanged at the deposit institution DI1.

The transferring of funds from the financial entity to one or moredeposit institutions may be performed, in one embodiment, by way of anintermediary bank 30 which may or may not be associated with themanagement institution 10. This movement/distribution of the funds maybe accomplished before or after the reshuffling of client accountbalances process. In one embodiment, a deposit of the funds to thedeposit institutions may be accomplished by sending, by any convenientmode of communication, e.g., wire, email, telephone, mail, etc., anorder to the intermediary bank 30 to transfer funds to selecteddestination deposit institutions DI associated with the financial entityand/or program in the amounts prescribed. For debits, in one embodiment,a wire or other convenient mode of communication may be sent by themanagement institution 10 or a self clearing financial entity dependingon whether or not the accounts are segregated, to a messenger service tohave a messenger deliver a transfer form sent to the deposit institutionto cause it to withdraw funds. In this manner, a debit of funds is madefrom selected deposit institutions associated with financial entity inamounts prescribed. Other known or future developed techniques fordelivering funds may also be used.

In an embodiment of the invention, the allocation process may also beused to ensure that the deposit institutions DI1-DIq comply with FDICregulations. For example, federal regulations currently prohibit morethan six withdrawals from interest bearing demand accounts during amonthly period using certain withdrawal techniques. In this regard, thedeposit institution allocation and/or the client balance allocationprocess may function to redistribute funds such that no more than amaximum number of withdrawals (e.g., five) are made from a singleaggregated account at a deposit institution during a monthly period orsome other required period. This may be accomplished by balancingdeposits and withdrawals so that there is net debit activity at only onedeposit institution on any given day, or in some embodiments only asmall number, of the deposit institutions DI1-DIq on a given day, andthe deposit institution which has the net debit activity is variedduring a reporting period so that the same deposit institution is notused more than a maximum number of times in a given month. The maximumnumber of times that a particular deposit institution may be used duringa monthly period may be set at any number, such as, for example, four orfive times per month, up to, for example, six, based on marketregulations. Thus, if the maximum number is set at five, for example, atleast four deposit institutions can be used in a given month to makewithdrawals (e.g., either the same deposit institution haswithdrawals/debits each day during a given week, the same depositinstitution receives debits only on a given day of the week, or atrandom).

Referring now to FIG. 2, an example embodiment of the allocation processis provided. The deposit institution allocation process may be run aftera sweep file containing transaction activity has been received andprocessed. The timing and content of the received sweep file isdetermined as a matter of administrative convenience based on how theclients transactions are processed by their respective financial entity.Accordingly, in a first step 200, a sweep file for a given financialentity, is received by the system. In one embodiment, the sweep file maycomprise data for deposit and withdrawal transactions for one or morePrograms in which that financial entity is participating. Multiple sweepfiles may be used at the same or different times of the day. Similarly,in another embodiment, a given sweep file may be an aggregation of sweepfiles from a given financial entity and various correspondent entities.For example, a clearing financial entity would not send to the system aseparate sweep file for each of its correspondent entities. Rather allactivity for the self clearing financial entity is included on the sweepfile, along with the transaction activity for all correspondents and/orprograms.

Referring to step 210, the various transactions in the sweep file areposted/applied to respective client accounts of the financial entity orits correspondents. Account liquidation orders and overdrafts and otherunusual transactions may be processed at this time. In one embodiment,agreement may be/or is required to be reached between the financialentity and the management institution 10 on each posting or on anaggregate of postings, and any discrepancies investigated.

Referring to step 220, the net activity for the sweep file for thatfinancial entity is then determined and an indication is made whetherthe net activity is a credit or a debit.

Referring to step 230, if the net activity is a credit, then the processdetermines if a balance at one or more destination deposit institutionsassociated with this program of that financial entity is below itsminimum cap, Min Cap.

Referring to step 240, the process will then allocate (the depositinstitution allocation) a credit, reduced in one embodiment by anyholdback amount (to be discussed below), to a respective one or moreaggregated accounts in one or more destination deposit institutionsassociated with that financial entity, or in some embodiments, with aparticular program associated with that Financial entity, provided thatthe aggregated accounts are below their respective minimum caps (MinCaps). If there is more than one aggregated account associated with thatfinancial entity below its respective minimum cap, the process willallocate according to one or more rules to the aggregated accounts in asequence order and amounts set for deposits. For example, one rule mightbe to always allocate first to aggregated accounts associated with thatfinancial entity/program whose Min Cap is set equal to its Max Cap andthe balance for that aggregated account is under the Min Cap. Anotherrule might be to allocate credits to aggregated accounts in thedifferent respective destination deposit institutions in an orderbeginning with the farthest aggregated account balance below itsrespective minimum cap up to the balance that is closest to the minimumcap. Another rule might be to deposit an amount only sufficient to bringthe balance held in the aggregated account deposit institution up to itsMin Cap, and then to allocate the remainder to an aggregated account ina different destination deposit institution associated with thatfinancial entity, where the balance in that aggregated account is belowits Min Cap, in an amount up to its Min Cap, etc. Thus, in oneembodiment, the process may attempt to satisfy the Min Cap for theaggregated account in each different destination deposit institution inits deposit institution allocation process if sufficient funds areavailable in the credit. Another rule may be to make deposits up to theMin Cap in a particular order of aggregated accounts in the differentdeposit institutions.

Referring to step 250, if the Min Cap for the respective aggregatedaccount in each different destination deposit institution associatedwith that financial entity has been satisfied, the process will thenlook for respective aggregated accounts in different destination depositinstitutions associated with that financial entity and/or program thatare below their respective Max Caps to which to allocate the credit, orremainder of the credit. In one embodiment, this credit may be reducedby a holdback amount (to be discussed below). If there is more than oneaggregated account below its respective maximum deposit cap, Max Cap,then the system will allocate the credit reduced by any holdback to theother respective aggregated accounts in the other destination depositinstitutions in a sequence and amount set by one or more rules fordeposits. By way of example, one rule might be to allocate clientaccount balances to respective aggregated accounts in the differentdestination deposit institutions with balances under the Max Cap bydescending order of available aggregated account capacity, i.e., how farits balance is below the Max Cap, or how far the balance is above theMin Cap. A further rule regarding the amount to be deposited mightcomprise, after the balance in the aggregated account at the depositinstitution reaches its maximum deposit cap, the management institution10 moves on to a respective aggregated account held in the nextdestination deposit institution associated with that financial entityand/or program that is below its maximum deposit cap. A further rule maybe to allocate deposits to a particular order of aggregatedaccounts/deposit institutions up to their Max Cap.

Note that in some situations some or all of the aggregated accountsassociated with a given financial entity and/or program may be at orover their respective Max Caps. When a new deposit associated withclient accounts of that financial entity or its correspondents isreceived, the system may allocate deposits to those aggregated accountsabove their respective Max Caps for these deposit institutions up to anAbsolute Cap that should not be exceeded. Alternatively, the excessdeposits, with the client's consent, may also be deposited in a non-FDICinsured accounts, such as a money market mutual fund.

Referring to step 260, if the net sweep amount is a debit, then theprocess may first look for respective aggregated accounts in thedifferent destination deposit institutions associated with thatfinancial entity and/or program whose deposit balance is above the MinCap to allocate the debit and, in one embodiment, adding a holdbackamount thereto. The process will allocate withdrawal of funds based on asequence and amount set by one or more rules for withdrawals. Forexample, one rule may be to bypass any aggregated account in adestination deposit institution that has its Min Cap set equal to itsMax Cap and its balance is at or above its Min Cap, unless there is noother option. A rule relating to the order for withdrawal might comprisedebiting in an order based on an amount that the balance in theaggregated account of the deposit institution exceeds the Min Cap forthat aggregated account. Another rule relating to the amount to bewithdrawn may be to set the amount to be withdrawn/debited from thegiven aggregated account in the destination deposit institution to beonly sufficient to bring its aggregated account balance down to theminimum cap for that aggregated account for that deposit institution. Afurther rule might be to bypass withdrawals from an aggregated accountthat has already had a given number of withdrawals in that period, e.g.,five. To the extent that none of the respective aggregated accounts inthe respective destination deposit institutions have greater than theirminimum cap in deposits, the management institution 10 may next follow afurther prescribed order set for withdrawals from the depositinstitutions.

Note that over the course of a period such as a day, there may bemultiple runs of the deposit institution allocation process. In oneembodiment, there may be a movement/transfer of funds to the one or moredeposit institutions shortly after each deposit institution allocationprocess is run. Financial entity sweep files may be received throughoutthe day. If a sweep file is received from a financial entity that has asegregated program, then the allocation process is run on that sweepfile. In one embodiment, as noted above, the allocation process might berun only after the management institution 10 and the financial entityagree upon a net settlement. One reason for obtaining an agreement upona net settlement amount between the management institution 10 and thefinancial entity prior to running the allocation process is to ensurethat the financial entity and the management institution 10 are inagreement on the activity to be posted. If there is a lack of agreementon such activity, then the activity must be investigated anddiscrepancies resolved before the bank allocation process is run. If asweep file is received from a financial entity other than a financialentity with a segregated program, the management institution 10, in oneembodiment, may run the deposit institution allocation process after allsweep files from all correspondent financial entities associated withthat program are received and posted.

Some financial entities may also provide a second sweep file or a latetransaction file for processing client transactions received late in theday after a cut-off time. The deposit institution allocation process isrun again after this second sweep file has been posted utilizing fundsheld back in the earlier allocation. Accordingly, a given financialentity could provide a sweep file at 9 am, 11 am and 1 pm, and themanagement institution 10 could run the deposit institution allocationprocess after each sweep file is posted followed by a transfer of fundsto the respective aggregated accounts in the one or more depositinstitutions. But the holdback funds would not be used in any of theseearly allocations and distributions. The holdback amount would only beemployed for the one or more deposit institution allocation processesrun after the cut off time (typically 4:00 pm).

Referring to step 270, the process then reshuffles/reallocates theinsured and uninsured account balances of the clients of the givenfinancial entity (whether or not they had a credit or debit to theiraccount) to fit precisely/match the deposit institution allocation tothe respective aggregated accounts done earlier in the day or other timeperiod. Note that, in one embodiment, the reshuffling/client accountbalance reallocation is run only at the end of the day based on the lastdeposit institution allocation to be run for that financial entity orthe management institution. This has the advantage of running thetime-consuming client account balance reshuffle/reallocation across alarge number of accounts distributed across a plurality of theaggregated accounts only once a day. Alternatively, thereshuffling/client account balance reallocation could be run after eachdeposit institution allocation process is run or it could be run atdifferent times of the day. Regarding the uninsured account balances,there may be some Programs that insure a client only up to a maximumamount of insurance, e.g. $1 million (for example, using 10 banks).Thus, if more than this Program maximum is deposited, some amount willbe uninsured for that client.

The allocation/reshuffling of client account balances may follow certainrules for insured deposits to maximize FDIC insurance. For example, theclient account balances may be allocated/reshuffled into destinationdeposit institutions to meet FDIC insurance limit requirements(currently $100,000 for an individual account) while minimizing thevolume of account balance redistributions required to match with thedestination deposit institution allocation. Likewise, a rule may befollowed that no more than six withdrawals may be made from a givendeposit institution during a period such as a month.

The client account balance allocation/reshuffling step may be subject tovarious additional account specific rules and financial entityoffice/branch office level rules. In one embodiment, client accountspecific rules may be used first to direct the client account balanceallocation. For example, if the client has opted out of a particulardestination deposit institution, for example, because the client hasfunds in that deposit institution via an account with another financialentity, or the client has designated that the first $100,000 is to bedeposited in a particular deposit institution, then such client accountbalance allocation will follow these rules in making the allocation ofthat client's balance. Then financial entity office/branch levelallocation business rules may be followed in allocating the remainingbalance of multiple accounts of the given financial entity in an orderand amount specified by the applicable rule(s). In one embodiment, theclient account balance allocation process thus first allocates non-zerobalance accounts according to account or office/branch level BusinessRules in descending aggregated account balance order. Finally, theclient account balance allocation process will then allocate non-zerobalance accounts not subject to any of the above applicable BusinessRules in descending account balance order.

Thus, in one embodiment client account balances of the individualclients of the financial entity and correspondents of that financialentity are allocated/reshuffled to the respective aggregated accounts inthe respective destination deposit institutions associated with thatfinancial entity in the sequence order denoted above until all of theaccount assets are allocated. In a further embodiment, there may be asegregation by Program, so that client account balances associated witha given Program will be allocated to respective aggregated accountsassociated with that Program in the respective destination depositinstitutions in the sequence order denoted above until all of theaccount assets are allocated. The process will conclude when all accountassets of the financial entity, or its correspondents in the case of aco-mingled account, are allocated across all deposit institutionsassociated with that financial entity.

Referring to step 280, processing for a financial entity that has anaffiliated deposit institution is performed. In this regard, certainfinancial entities, such as banks, broker dealers, or financial advisorsmay have an affiliate relationship with a particular depositinstitution. An insured deposit program of a financial entity frequentlyprovides a valuable source of deposits for a given affiliated depositinstitution which enables that deposit institution to support activitiessuch as mortgage, loans, credit card activity, to name a few. Thedeposit institution then has a wealth of potential deposits thatpreviously had gone to a money fund. To facilitate this access for agiven affiliated deposit institution, this deposit institution may begiven preference in the allocation by means of a minimum cap and one ormore priority rules so that, for example, the first $100,000 of everyaccount is deposited in the affiliated deposit institution as well anybalances over the available insurance coverage for the account, e.g.,any client deposit over $1 million. Another relationship or businessrule to facilitate this affiliation may be that assets for a definedclient account population of that financial entity are to be dedicatedto/deposited to affiliated deposit institution for various reasons. Suchaccount populations are usually defined by a branch/correspondentrelationship and there is an associated business rule (e.g., an insureddeposit instruction) set up for the branch or correspondent designatingthe affiliated deposit institution as the institution for the firstdeposit.

An advantage of using an affiliated deposit institution relationship setup via a minimum cap and one or more rules is that the affiliatedprogram allows the affiliated deposit institution to manage its balancesheet to obtain structured growth. In this regard, even if an affiliateddeposit institution is in a growth mode, for example, growing its loanportfolio, it may not be able to put to work/lend out more than acertain amount of money over a given period of time. It would beundesirable to take in a large amount of deposits on which interest isto be paid if the money cannot be lent out quickly. Thus, the minimumcap for the affiliated deposit institution can be increased as the needsof the loan portfolio increase. Thus, the minimum cap can be increasedmanually as capital requirements dictate. For example, if the affiliateddeposit institution is purchasing a loan portfolio, the transfer ofadditional deposits to fund the loans can be scheduled. Alternatively,the minimum cap can be increased automatically, for example, based on acriterion. In one embodiment, the criterion might comprise a period oftime. In another embodiment, the criterion might comprise reaching a newlevel of net assets in the aggregated account of the affiliated depositinstitution. Another criterion might be that an amount of a capitalusage level, such as a current or projected loan portfolio of retailloans or mortgages, has reached a predetermined level. Accordingly, whenan affiliated deposit institution is in a start up mode, the affiliateddeposit institution can manage its growth by controlling the depositsreceived from the broker dealers' clients. All this may be accomplishedby setting the min cap and/or rules to schedule when additional depositsare to be directed to the aggregated account in the deposit institution.

Alternatively, if the affiliated deposit institution finds that it hasmore deposits than it can put to work, based on a current or projectedcapital usage level, then deposits can be withdrawn and placed withother destination deposit institutions associated with that financialentity. This withdrawal can be accomplished by setting and/or reducing amaximum cap coupled with one or more priority withdrawal rules for theaggregated account of the affiliated deposit institution. In oneembodiment, a priority rule is set for the aggregated account of theaffiliated deposit institution which requires that debits are first tobe allocated to that aggregated account until the amount of net assetsfor the aggregated account drops to or below a respective maximum cap.Note that the maximum cap associated with the aggregated account of theaffiliated deposit institution can be decreased manually to decrease theamount of net assets at the selected deposit institution based on adecreasing capital usage level, which may either be a current capitalusage level or a projected capital usage level. In one embodiment, themaximum cap associated with the aggregated account can be decreasedautomatically, for example, based on a criterion. In one embodiment, thecriterion is a time period. In another embodiment, the criterion is adropping to a new level of net assets in the given one of the aggregatedaccounts. In a further embodiment, the criterion is that an amount of acapital usage level has dropped to a predetermined amount.

Note that the minimum cap and maximum cap operations and the rules tofacilitate the affiliation relationship rule would have been one of therules followed in running the deposit institution allocation process andthe client account balance allocation process of FIG. 2, since thedeposit institution allocation and the client account balance allocationprocesses respect all such branch/correspondent business rules.

In one embodiment, in order to build up/decrease assets at theparticular affiliated deposit institution, a process may be run in step280 in the morning of the subsequent business day or other period todetermine the prior day's net activity for that affiliated depositinstitution. The process step 280 would then adjust one or both of theMin and Max Caps for the deposit institution accordingly. In this mannerdeposits at the deposit institutions may be increased/decreased the nextday by the prior day's net activity of a given client account populationof a given financial entity and then maintained via the adjustment ofthe Min and Max Caps.

The process in one embodiment thus will derive, after posting, a netactivity amount from daily financial entity sweep transactions andallocate the net amount to one or more destination deposit institutionsbased on deposit caps (Min Cap, Max Cap and Absolute Cap) and sequenceorder set by rule for the destination deposit institutions. The actualmovement/distribution of funds to the deposit institutions takes placeafter this deposit institution allocation. Then the account balances ofthe clients of the financial entity are re-shuffled/allocated to meetthis determined allocation. In one embodiment, the entire day's activitymay be fit into one or a few deposit institutions based on considerationof the balances in the respective aggregated accounts in the differentdestination deposit institutions associated with the financial entity(s)or program with respect to the desired caps for the respectiveaggregated accounts and the various controlling rules.

FIG. 3 is a flowchart describing the operational process of sendingemail to deposit institution and the financial entity moving the fundsbetween deposit institutions. In step S102, the process is initiated, inone embodiment after each deposit institution allocation process hasbeen run. In another embodiment, the step S102 could be initiated at theend of the day after all allocations from the financial entity have beencompleted. In step S104, the management institution 10 calculates, asdescribed in the embodiment of FIG. 2 as one example, the net activityrequired at one or more aggregated accounts held in a respective one ormore different destination deposit institutions in order to satisfypredefined program rules described previously. As noted previously, thenet activity may be calculated to specifically take into account theminimum account balances, Min Caps, required to maintain asset stabilityin respective aggregated accounts at various different respectivedestination deposit institutions, the maximum account balances, MaxCaps, set in order to maintain compliance with credit policy parameters,to limit the number of withdrawals, and based on various business rules.

Returning now to the deposit institution allocation process shown inFIG. 3, in step S106, the management institution 10 may determine perdeposit institution whether any net activity has been calculated in stepS104. The net activity may be net debit activity or net credit activity.If there should be net activity in a deposit institution, the processcontinues to step S108, where the management institution 10 may sendnotification of the necessary net activity to the deposit institution.Otherwise, if there is no net activity (i.e., the net activity is zero),the process will end at step S124. As noted, for some embodiments of thepresent invention the allocation process may minimize the number ofaggregated accounts in the respective destination deposit institutionswith net debit activity, in a manner such that no single aggregatedaccount in a destination deposit institution has net debit activityduring a monthly period more than a maximum number of times, e.g., 5 or6 times. The notification to the deposit institutions that require netactivity may be in the form of e-mail, facsimile, mail, messenger orthrough any other suitable form of communication.

In step S110, the management institution 10 may send a depositinstitution allocation report to the financial entity. The depositinstitution allocation report preferably includes information regardingthe amount of the required net activity and the reason why the netactivity is required to satisfy program rules. In step S112, themanagement institution 10 may send a transfer form to the financialentity that does business with a deposit institution that requires a netactivity. The transfer form preferably indicates that a net debittransfer or a net credit transfer needs to be initiated in an aggregatedaccount in a destination deposit institution that is to have a netactivity. The deposit institution allocation reports and the transferforms may be sent to the necessary financial entities via e-mail,facsimile, mail, messenger or through any other suitable form ofcommunication.

In step S114, the financial entities that do business with a depositinstitution that requires a net activity review may approve the transferform sent to them. In this regard, the financial entities may review thedeposit institution allocation reports to verify that the net sweepactivity is equal to net activity within the deposit institutions. Instep S116, the financial entity may determine whether the net activityis a net debit. If the net activity is a net debit, the process maycontinue to step S118, where the financial entity preferably completes adebit transfer form and sends the debit transfer form, via e-mail,facsimile, mail or through any other suitable form of communication, tothe deposit institution that requires a net debit. In one embodiment,the financial entity or management institution may use a messenger tosend the debit transfer form to the deposit institution. In otherembodiments the financial entity or management institution may requestthe debit in person, by mail, by automated teller machine, and using thetelephone and distributing by mail. The process then continues to stepS120, where the necessary funds are transferred from the depositinstitution to the financial entity account. The process then ends atstep S124.

In step S116, if the financial entity determines that the net activityis not a net debit (i.e., the net activity is a net credit), the processmay continue to step S122, where the financial entity transfers fundsfrom the financial entity account to the deposit institution account.The transfer of funds may be completed by a wire transfer, or othersuitable process. The process then ends at step S124.

The management institution 10 provides the financial entities FE1-FEnwith all the tools necessary to reconcile daily, or on any otherperiodic basis, with the deposit institutions DI1-DIq. In particular,FIG. 4 is a flow chart illustrating a reconciliation process that may beperformed by the management institution 10 according to an exemplaryembodiment of the present invention. In step S202, the reconciliationprocess may be initiated, preferably on a daily basis, but may also beinitiated on any other suitable time basis. In step S204, the managementinstitution's 10 shareholder accounting system (SAS) produces a reportthat reflects per deposit institution DI1-DIq information such as thebeginning balance, daily subscriptions, daily withdrawals, pre-paidinterest, shareholder accrued interest, ending balance and otherrelevant information. Preferably, data such as, for example, the rateeach deposit institution has agreed to pay on deposits, the rate thatthe management institution has agreed to pay the financial entity onbalances, the interest distributed to clients, the financial entity'srevenue after interest has been paid, and the management institution'srevenue after the financial entity has been paid, is maintained on asystem table. Alternatively, the data can also be provided in a dataformat that can be downloaded to an automated reconciliation tool orsoftware.

In step S206, the management institution 10 may obtain through, forexample, on-line access or daily e-mails from the deposit institutionsDI1-DIq, the daily activity and ending position for each depositinstitution DI1-DIq. For online access, the management institution 10may assign an individual username and password for each depositinstitution DI1-DIq in order to maintain security. The depositinstitutions can also provide a data file or the management institution10 can screen scrape the data to be imported into an automatedReconciliation tool or software.

After all the deposit institution information is received, in step S208of the reconciliation process, the management institution 10 generates aspreadsheet showing the aggregated account information in each depositinstitution DI1-DIq as obtained directly from each deposit institutionDI1-DIq and as generated by the SAS (shareholder accounting system).This aggregated account information may be arranged by financial entity,by client, or both, or in any other convenient way. In step S210, themanagement institution 10 uses the generated spreadsheet to compare theending balances from the SAS Report to that obtained from each depositinstitution DI1-DIq. In step S212, it is determined whether there areany differences between the ending balances. If there are nodifferences, in step S214, the reconciliation spreadsheet is saved inthe system database, and a copy of the spreadsheet is sent to theappropriate financial entity FE1-FEn. The process then ends at stepS216.

If there are differences between the ending balances from SAS and theending balances obtained from each deposit institution DI1-DIn, theprocess continues to step S218, where the management institution 10researches and identifies the differences. In this regard, differencesmay be immediately reported to the appropriate deposit institution 10and preferably resolved within 24 hours. Further, a representative ofeach financial entity may be notified by phone, e-mail, text message,messenger or other type of communication method of any differences andhow the issue is being resolved. Thus, a reconciliation process isprovided that may ensure that client balances reflected in the recordsmaintained by financial entities for their participating clients areequal to the client balances reflected in a management institution'srecords for those same participating clients, and that aggregatebalances maintained in aggregated accounts in respective depositinstitutions are in balance with an aggregate balance of the individualclient balances reflected in the management institution records and thefinancial entity records. On a daily basis or other periodic basis, thisreconciliation process in one embodiment includes comparing theaggregate balances for clients maintained by the management institutionto the position maintained at the financial entity for each of itsclients, comparing the aggregate balance at each deposit institutionmaintained by the management institution to the actual aggregate balanceat each deposit institution, and in addition a control operating accountin an intermediate bank used for facilitating fund transfers isreconciled to ensure the correct money movements as specified by thevarious deposit institution allocations has taken place.

The management institution 10 may also maintain tax records on behalf ofclients of the financial entities along with tracking of interesttransactions posted to the clients' accounts. Interest may be accrueddaily or over any other convenient period and posted at month end orwhen a full liquidation occurs. Month-end may be, for example, the lastFriday of the month or the actual calendar month-end. Other month-enddates may be made available depending on the financial entity needs orpreferences.

Note that because fund transfers from financial entities, in someembodiments, are held in a control operating account at the intermediarybank 30 on an interim basis, e.g., several hours up to a day, beforedistribution to the various aggregated accounts in the differentdestination deposit institutions, there is a potential that portions oflarge deposits from a given client of the financial entity that exceedthe FDIC insurance limit will be uninsured during this interim period.FIG. 5 is a flow-chart illustrating an embodiment of a intermediary bankinterim allocation process that may be performed by the managementinstitution 10 on large deposits in order to preserve FDIC insurance andfor other reasons. According to an exemplary embodiment of the presentinvention, in order to preserve FDIC insurance eligibility for excessdeposits by one client in a control operating account for a financialentity above the insurance limit transferred and held at theintermediary bank 30 during an interim period (from one to several hoursto one day) before allocation to the deposit institutions DI1-DIq, theexcess deposit amounts over the FDIC insurance limit may be reallocatedto other eligible clients of the financial entity in the controloperating account at the intermediary bank 30. In one embodiment,another client of the financial entity would be eligible for such are-allocation if that other client has funds in one or more aggregatedaccounts associated with the same self clearing financial entity as theclient with the incoming excess deposit, or if the incoming funds areassociated with an financial entity that is not self clearing, then aneligible client would be one that had funds in an aggregated accountthat participates in a Program where the management institution 10 is anagent on the aggregated account at the deposit institution. A furtherrequirement for eligibility is that the potentially eligible client doesnot have substantial funds that approach the level of the FDIC insurancelimit in the control operating account in the intermediary bank at thattime. As noted, if the management institution 10 were offering aninsured deposit program to a group of banks, for example, with the bankscomprising the clients, the management institution 10 could allocatefunds from the control operating account for the one bank that exceedsthe FDIC insurance limit with funds of another bank held in one or moreaggregated accounts in one or more respective different destinationdeposit institutions in the same insured deposit program managed by themanagement institution 10, provided there was eligibility (the otherclients did not have substantial funds in the control operatingaccount), to bring the clients of the one bank's deposit in the controloperating account below the FDIC insurance limit.

The interim allocation process may be performed at various timesthroughout the day, such as, for example, on an hourly basis, or aslarge transactions are processed. The interim allocation process isconcerned with maintaining the amount of funds held by each client ofthe financial entity or the management institution below the present$100,000 limit required to maintain full FDIC insurance, even during theinterim period before the funds have been allocated and transferred fromthe intermediary bank 30 to the various aggregated accounts in thedeposit institutions DI1-DIq. Should this maximum change, the teachingsof the present application would be equally applicable to any then-ineffect maximum.

Referring to FIG. 5, in step S02, the interim allocation process isinitiated at the beginning of the day. For purposes of the presentinvention, the term “day” may mean either every business day or everycalendar day, as is the custom of the intermediary bank. At step S04,the process monitors the sweep transactions posted to the clients on aperiodic basis, such as on an hourly basis. In step S06, the managementinstitution determines whether any client at the intermediary bank 30 isover the $100,000 limit. If there is no client over the limit at theintermediary bank 30, the process proceeds to step S12, where theprocess determines whether the end of the day has arrived. In step S12,if the end of the day has arrived, the process continues on to the finalprocessing, to be described in more detail below. Otherwise, the processreturns to step S04.

In step S06, if there is a client with assets at the intermediary bank30 over the $100,000 limit, the process continues to step S08, where theprocess performs an interim allocation evaluation. The processdetermines which clients have a deposit over $100,000 and thenreshuffles account balances between the intermediary bank and one ormore aggregated accounts at the respective different destination depositinstitutions, so that the excess deposit is insured until the actualbank allocation takes place. During the interim allocation evaluation,the process determines if one or more clients of the financial entitythat have funds held in aggregated accounts in the respective one ormore destination deposit institutions associated with the financialentity are eligible in the accounting database to receive the excessfunds from the excess deposit client over the $100,000 limit to bringthat excess deposit client balance below the limit in the controloperating account. In one embodiment, eligibility of another client toreceive excess funds is determined by whether or not that other clienthas funds at the intermediary bank below the $100,000 FDIC limit by somepredetermined amount and also by whether that particular client hasfunds in one or more aggregated accounts at the respective different oneor more destination deposit institutions associated with the samefinancial entity or the same Program as the incoming excess clientdeposit, or in one or more aggregated accounts that comingle funds fromPrograms of the financial entity in one or more destination depositinstitutions DI1-DIq associated with that financial entity, that can bereallocated to replace the excess amount of the deposit of the oneclient in the control operating account. Thus, during this step, theprocess determines how best to reallocate the assets among the otherclients of that financial entity to ensure that after the reallocation,none of the clients with funds at the intermediary bank 30 have assetsthat total over $100,000, or at least minimize the uninsured assets tothe extent possible.

In step S10, the process allocates the assets among the clientsaccording to the evaluation performed in step S08. The process may alsogenerate an interim allocation report and send the report via fax,e-mail, text message, or by any other suitable communication method tothe financial entities and the deposit institutions involved. Theprocess then continues to step S12, where the process determines whetherthe end of the day has arrived, as discussed above. Thus, this interimallocation process obtains, after the reallocation, FDIC insurance forthe excess funds of a client over $100,000 when those funds are broughtinto the control operating account in the intermediary bank 30 in theinterim period prior to allocation among the deposit institutionsDI1-DIq. If the end of the day or some other convenient point hasarrived, then accounting processes are performed to insure that theclient funds of eligible clients used to replace the one clients fundsin the control operating account receive the specified interest rate forthe account as if no interim allocation had taken place.

It should be noted that the foregoing process relating to client amountsin control operating accounts, in some embodiments may be separate andapart from the previously discussed allocation among depositinstitutions to meet minimum and maximum levels.

As noted previously, a holdback withdrawal amount may be applied againstthose deposit institutions that are designated as holdback depositinstitutions. A deposit institution may be designated a holdbackinstitution if it agrees to a temporary withdrawal of funds from itsaccount which may be later used to settle late day client service andfee transactions, for example, cards/checks/ACH/fees, to name a few,that may be available for processing after the daily deposit institutionsettlement deadline, typically 4:00 pm. The holdback withdrawal may befactored into the first runs and/or later runs of the depositinstitution allocation process on the sweep files, i.e., subtracted fromcredits to reduce the deposits to be allocated or added to debits toincrease the dollar amount withdrawn from the holdback depositinstitution.

FIG. 6 is a flow chart illustrating a deposit institution allocationprocess that can be performed by the management institution 10 accordingto another exemplary embodiment of the present invention incorporating amethod, such as the holdback process or financial entity funding, forfunding late withdrawals. The process according to the presentembodiment is the same as the embodiment of FIG. 3 except for theaddition of steps S117 and S119, which address withdrawal requests madeafter the deposit institution withdrawal cut-off time. In particular,after the financial entity reviews and approves the transfer form instep S114, and it has been determined that there is a net debit in stepS116, the process may continue to step S117. In step S117 the financialentity initiates the movement of funds by first determining whether therequest for withdrawal (the net debt) from the deposit institutionoccurs prior to the cut-off time at the deposit institution. If prior tothe cut-off time, the process continues on to step S118, where, asexplained previously, the financial entity completes and sends a debittransfer form to the deposit institution.

In step S117, if it is determined that the request for withdrawal occursafter the cut-off time, the process may continue to step S119, wherepost cut-off time withdrawal procedures are initiated. The post cut-offtime withdrawal procedures may include, for example, a procedure inwhich late withdrawals are covered by the financial entity concurrentlyfunding the late withdrawals, or a procedure in which funds are heldback from one or more deposit institutions to cover the latewithdrawals. These two types of post cut-off time withdrawal proceduresare discussed below.

In the financial entity funded late withdrawals, one or more financialentity account(s) may be established for the financial entity in theprogram at one or more deposit institutions. The financial entity maydeposit an amount of funds in a financial entity account that is equalto the amount of funds withdrawn from the deposit institutionsubstantially concurrently with that withdrawal. Thus, the change to thenet daily activity is zero and the overall deposit institutionallocation procedure is not affected.

In the hold-back procedure for funding late withdrawals, funds are heldback from the deposit institution to cover the late withdrawals. Theamount held back from pre-cutoff transactions may be estimated based onprior transaction history. The allocation process will take into accountthe amount to be held back at a particular deposit institution in itsdistribution of funds allocated to or withdrawn from the given depositinstitution. If the distribution of funds for the given depositinstitution is a credit, the allocation process may reduce the depositto the deposit institution by an amount equal to the hold back amount.If the distribution of funds for the given deposit institution is adebit, the allocation process may increase the withdrawal from thedeposit institution by an amount that is equal to the hold back amount.

Referring to step S119, the post cut-off time withdrawal procedures maybe performed to cover all late transactions (for example,cards/checks/ACH/fees, etc.) or transaction data not processed in theearlier runs of the allocation process. The management institution 10may determine the net of these transactions, and transfer theappropriate amount from the holdback funds to cover these latetransactions. The management institution 10 then determines any excessholdback amount not required to fund these transactions. The excessholdback not required to fund these transactions may be deposited backto the designated holdback deposit institutions as additional wires, orthrough other suitable methods.

The process then continues to step S124, where the process ends. If thepost cut-off withdrawal procedure involves funding by the financialentity, an equal amount of funds may be later deposited in the financialentity account from the deposit institution. Thus, if the financialentity is funding late transactions, a deposit is made by the financialentity to its own account, to offset the late withdrawals. The reshuffleof accounts at the end of the day, determines which deposit institutionsthe financial entities deposit is assigned to.

FIG. 7 shows a month-to-date (MTD) accrual process 700 executed by themanagement institution 10 according to an exemplary embodiment of thepresent invention. As shown in FIG. 7, the management institution 10calculates 710 the MTD interest for a customer using the customer'sprincipal balance. The management institution 10 may then generate adeposit institution settlement report 720 that includes the MTD interestinformation, and sends the report 720 to the client's financial entity.The deposit institution settlement report 720 may be generated on anightly basis, or on any other basis. The management institution 10 mayprovide daily compounding interest, or if appropriate, may also providea simple interest calculation.

As shown in FIG. 7, the management institution 10 may also calculate 730the interest, per account, at the deposit institution level by using theend-of-day balance at each deposit institution (e.g., DepositInstitutions A, B and C in FIG. 7) in which the client's funds have beendeposited. The management institution 10 may generate balance andaccrual reports 740 for each deposit institution using the end-of-daybalances. In one embodiment, the management institution 10 may calculatethe interest rate the deposit institution agreed to pay on balances.This calculation may be broken into two parts: a calculation of interestto be distributed to clients, which is credited to the MMDA at month endas interest; and a calculation of a remainder amount, which may compriserevenue that is paid to the management institution, which may then pay aportion to the financial entity.

The deposit institutions typically only pay interest at month-end. Thus,according to at least one exemplary embodiment of the present invention,the management institution 10 may employ a prepaid interest process topay customers on full liquidations that occur prior to month-end.

FIG. 8 is a flow chart illustrating a prepaid interest process used bythe management institution 10 according to an exemplary embodiment ofthe present invention. In step S802 a financial entity pre-funds acustomer interest account, which may be per customer or an aggregatedaccount for a plurality of customers based on an estimate of how manycustomer will closeout their respective accounts in that period. Thiscustomer interest account is preferably held in the financial entity'sname at an intermediary deposit institution but may be set up otherwiseas appropriate. Step S802 may be performed at the first day of themonth, but may also be performed on a preferred periodic or otherconvenient basis. Alternatively, the management institution 10 oranother entity may pre-fund the customer interest account. At step S804,which takes place at some day during the month, the customer may requestfull liquidation of an account with funds held at one or more of thedeposit institutions. At step S806, the deposit institution sends theprincipal amount in the account to the financial entity control accountand retains the accrued interest. In step S808, the amount due to thecustomer is determined based on the customer's arrangement with thefinancial entity and this amount is transferred from the pre-fundedinterest, i.e., pre-paid interest, from the customer interest account tothe financial entity control account to cover the amount of interestrequired to be delivered to the customer. In step S810, the financialentity pays the customer the principal, and the interest due (pre-paidinterest) from the financial entity control account based on thearrangement with the customer.

At month end the appropriate interest is posted by the depositinstitution to the MMDA. Then in step S812, the interest that waspre-paid and transferred to the customer is requested to be transferredfrom the deposit institution to the financial entity's control account.In other words, the FI reimburses itself for the interest that waspre-paid to the customer. After receiving the amount of pre-paidinterest, in step S814, the financial entity transfers all or a portionof the pre-paid interest to the customer interest account. Thus, thefinancial entity can be refunded the amount of the interest thefinancial entity pre-paid for and transferred to the customer.

FIG. 9 is a block diagram showing an Internet-based aggregatedtransaction account management system, generally designated by referencenumber 900, according to another exemplary embodiment of the presentinvention. It should be appreciated that the aggregated accountmanagement system 900 according to the present invention need not beInternet-based, but may instead, for example, be part of a closednetwork that allows limited access to deposit institution and financialentity records for added security. The management system 900 includes amemory 910, a CPU 912, a deposit institution allocation system 914, areconciliation system 916, a fund withdrawal system 918 and an interestmonitoring system 920. The CPU 912 executes code to perform the variousmanagement functions performed by the management system 900. Themanagement system 900 communicates with the financial entity computersystems 950 and the deposit institution computer systems 960 to managethe aggregated accounts held at each deposit institution.

The deposit institution allocation system 914 allocates deposits to andwithdrawals from the aggregated accounts in each deposit institutionDI1-DIq. The deposit institution allocation system 914 includes a nettransaction activity monitor 922 that calculates the net transactionactivity required at each deposit institution to satisfy thepredetermined program rules described above and other rules as requiredfor each program held at each deposit institution DI1-DIq. The depositinstitution allocation system 914 also includes a message generator 924that generates one or more messages and settlement wires regardingwithdrawal of funds from or deposit of funds to each of the aggregatedaccounts. Messages may, for example, be in the form of e-mail,facsimile, text message or other form of communication. Such messagesmay be sent to the financial entities FE1-FEn and/or the depositinstitutions DI1-DIq for notice or request for approval, and may includeinformation such as, for example, the amount withdrawn or deposited andthe reason for the withdrawal or deposit.

The reconciliation system 916 reconciles inconsistencies between systemreported deposit institution periodic activity data and observed depositinstitution periodic activity data reported by the deposit institutions.The reconciliation system 916 includes a data collector 926 thatreceives the reported deposit institution periodic activity data fromeach deposit institution DI1-DIq. Such data may include, for example,the beginning balance for the period, the ending balance for the period,the periodic subscription deposits, the periodic withdrawals, pre-paidinterest and accrued interest, posted interest and adjustments. Thereconciliation system 916 also includes a reporting system 928 thatreports any inconsistencies between the reported deposit institutionperiodic activity data and the activity as determined by the presentprocess. Note that the data structure for withdrawals, and/or depositscan be bank data files, such as BAI files or the management institution10 could screen scrape the data off a website.

The system 900 additionally includes a fund withdrawal system 918 and ainterest monitoring system 920. The fund withdrawal system 918 initiatesa post cut-off time withdrawal procedure to withdraw funds from adeposit institution to satisfy a net debit after a cut-off time haspassed. The post cut-off time withdrawal procedure may include, forexample, funding the net debit from a corresponding financial entityaccount or holding back an amount during the allocation process to coverthe post cut-off time net debit.

The interest monitoring system 920 monitors interest payments made forclient accounts, where each of the client accounts send deposits to andreceive withdrawals from a corresponding one or more of the aggregatedaccounts in one or more deposit institutions. The interest monitoringsystem 920 includes an interest calculation system 930 that, for eachclient account, calculates a term-to-date interest due to the clientaccount based on amounts withdrawn from or deposited to the aggregatedaccounts. The term is preferably one month, but may also be any othersuitable period of time. The interest monitoring system 920 alsoincludes an interest reporting system 932 that, for each client account,generates a report on a periodic basis that includes the calculatedterm-to-date interest due to the client account based on the amountswithdrawn from or deposited to the aggregated accounts. The interestmonitoring system 920 may also include an interest funding system 934that, for each client account, pre-funds interest to be paid to theclient account as a result of a mid-term liquidation request from thecorresponding client.

It should be noted that although the flow charts provided herein show aspecific order of method steps, it is understood that the order of thesesteps may differ from what is depicted. Also two or more steps may beperformed concurrently or with partial concurrence. Such variation willdepend on the software and hardware systems chosen and on designerchoice. It is understood that all such variations are within the scopeof the invention. Likewise, software and web implementations of thepresent invention could be accomplished with standard programmingtechniques with rule based logic and other logic to accomplish thevarious database searching steps, correlation steps, comparison stepsand decision steps. It should also be noted that the word “component” asused herein and in the claims is intended to encompass implementationsusing one or more lines of software code, and/or hardwareimplementations, and/or manual operations.

While this invention has been described in conjunction with theexemplary embodiments outlined above, it is evident that manyalternatives, modifications and variations will be apparent to thoseskilled in the art. Accordingly, the exemplary embodiments of theinvention, as set forth above, are intended to be illustrative, notlimiting. Various changes may be made without departing from the spiritand scope of the invention.

1. A method, comprising: (A) accessing, using one or more computers, oneor more databases comprising: (1) aggregated deposit account informationfor a plurality of government-backed insured and interest-bearingaggregated deposit accounts held in a plurality of deposit institutions,each of the respective deposit institutions holding one or more of theaggregated deposit accounts, each of the aggregated deposit accountsholding funds of a plurality of client accounts; and (2) client accountinformation for each of more than one of the respective client accounts,the client account information for a respective one of the clientaccounts comprising a respective balance of funds of the respectiveclient account held in each of one or more of the government-backedinsured and interest-bearing aggregated deposit accounts holding fundsof the respective client account; and (B) determining, using the one ormore computers, at least one aggregated deposit account in one of thedeposit institutions to which to deposit/transfer or towithdraw/transfer funds, based at least in part on a selection rule todirect fund transfer activity to this one aggregated deposit account,and/or based at least in part on a selection rule to direct fundtransfer activity away from one or more other of the respectiveaggregated deposit accounts; (C) obtaining transfer data comprising anamount of funds comprising deposits/transfers to and/orwithdrawals/transfers from one or more of the aggregated depositaccounts; (D) allocating funds, using the one or more computers, to oneor more of the aggregated deposit accounts held in one or more of thedeposit institutions based on the transfer data and on one or moreallocation rules; (E) allocating, using the one or more computers, fundamounts of client accounts among the aggregated deposit accounts, tosubstantially match respective amounts allocated to the aggregateddeposit accounts based on the transfer data and the one or moreallocation rules; (F) generating and communicating data for one or moreinstructions, using the one or more computers and a networkcommunication link, to transfer funds to or from the at least oneaggregated deposit account based at least in part on one or more of theallocating steps; and (G) updating, using the one or more computers, theone or more databases with information based at least in part on one ormore of the allocating steps.
 2. The method as defined in claim 1,wherein the generating and communicating data step comprises: generatingtransfer data for a sub-period of time, using the one or more computers,for a deposit/transfer of funds to or a withdrawal/transfer of fundsfrom, the at least one aggregated deposit account, the allocatingcomprising: (i) determining, using the one or more computers, whetherthe deposit/transfer of funds or the withdrawal/transfer of funds is fora sub-period of time before or after a cutoff time; (ii) generatingfirst transfer data for one or more instructions, using the one or morecomputers, for at least one sub-period of time that is before the cutofftime for a first deposit/transfer of funds to or a firstwithdrawal/transfer of funds from, the at least one aggregated depositaccount, while holding back a holdback amount of funds; (iii) generatingsecond transfer data for one or more instructions, using the one or morecomputers, where the sub-period of time is after the cutoff time, for atleast a second withdrawal/transfer of an amount of funds from theholdback amount of funds and/or for withdrawal/transfer of an amount offunds from or deposit/transfer of an amount of funds to, the at leastone aggregated deposit account.
 3. The method as defined in claim 2,wherein for the at least one sub-period of time that is before thecutoff time, determining a withdrawal/transfer from the at least oneaggregated deposit account based at least in part on one or more of theallocating steps; and increasing an amount of the withdrawal/transferfor the at least one aggregated deposit account based at least in parton the holdback amount.
 4. The method as defined in claim 2, wherein forthe at least one sub-period of time that is before the cutoff time,determining a deposit/transfer to the at least one aggregated depositaccount based at least in part on one or more of the allocating steps;and decreasing an amount of the deposit/transfer for the at least oneaggregated deposit account based at least in part on the holdbackamount.
 5. The method as defined in claim 2, further comprisingreceiving or obtaining the holdback amount.
 6. The method as defined in2, further comprising calculating, by the one or more computers, theholdback amount.
 7. The method as defined in claim 1, wherein theamounts of client accounts allocated are client account balances, wherethe respective client account represents funds of the respective clientheld in the one or more of the aggregated deposit accounts holding fundsof the client.
 8. The method as defined in claim 1, wherein, for eachaggregated deposit account with a no-withdrawal designation, the step ofallocating further comprises: offsetting, by the one or more computers,any withdrawal/transfer from this aggregated deposit account withdeposits/transfers from another aggregated deposit account that does nothave a no-withdrawal designation and is in a different one of thedeposit institutions.
 9. The method as defined in claim 8, furthercomprising: selecting the another aggregated deposit account based, atleast in part, on whether it is associated in the one or more databaseswith a same financial entity as the aggregated deposit account with theno-withdrawal designation.
 10. A system, comprising: one or morecomputers comprising memory wherein the memory stores computer-readableinstructions comprising program code that, when executed, cause the oneor more computers to perform the steps: (A) accessing, using the one ormore computers, one or more databases comprising: (1) aggregated depositaccount information for a plurality of government-backed insured andinterest-bearing aggregated deposit accounts held in a plurality ofdeposit institutions, each of the respective deposit institutionsholding one or more of the aggregated deposit accounts, each of theaggregated deposit accounts holding funds of a plurality of clientaccounts; and (2) client account information for each of more than oneof the respective client accounts, the client account information for arespective one of the client accounts comprising a respective balance offunds of the respective client account held in each of one or more ofthe government-backed insured and interest-bearing aggregated depositaccounts holding funds of the respective client account; and (B)determining, using the one or more computers, at least one aggregateddeposit account in one of the deposit institutions to which todeposit/transfer or to withdraw/transfer funds, based on a selectionrule to direct fund transfer activity to this one aggregated depositaccount, and/or based at least in part on a selection rule to directfund transfer activity away from one or more other of the respectiveaggregated deposit accounts; (C) obtaining transfer data comprising anamount of funds comprising deposits/transfers to and/orwithdrawals/transfers from one or more of the aggregated depositaccounts; (D) allocating funds, using the one or more computers, to oneor more of the aggregated deposit accounts held in one or more of thedeposit institutions based on the transfer data and on one or moreallocation rules; (E) allocating, using the one or more computers, fundamounts of client accounts among the aggregated deposit accounts, tosubstantially match respective amounts allocated to the aggregateddeposit accounts based on the transfer data and the one or moreallocation rules; (F) generating and communicating data for one or moreinstructions, using the one or more computers and a networkcommunication link, to transfer funds to or from the at least oneaggregated deposit account based at least in part on one or more of theallocating steps; and (G) updating, using the one or more computers, theone or more databases with information based at least in part on one ormore of the allocating steps.
 11. The system as defined in claim 10,wherein the memory stores computer-readable instructions comprisingprogram code that, when executed, causes the one or more computers toperform the steps: generating transfer data for a sub-period of time,using the one or more computers, for a deposit/transfer of funds to or awithdrawal/transfer of funds from, the at least one aggregated depositaccount, the allocating comprising: (i) determining, using the one ormore computers, whether the deposit/transfer of funds or thewithdrawal/transfer of funds is for a sub-period of time before or aftera cutoff time; (ii) generating first transfer data for one or moreinstructions, using the one or more computers, for at least onesub-period of time that is before the cutoff time for a firstdeposit/transfer of funds to or a first withdrawal/transfer of fundsfrom, the at least one aggregated deposit account, while holding back aholdback amount of funds; (iii) generating second transfer data for oneor more instructions, using the one or more computers, where thesub-period of time is after the cutoff time, for at least a secondwithdrawal/transfer of an amount of funds from the holdback amount offunds and/or for withdrawal/transfer of an amount of funds from ordeposit/transfer of an amount of funds to, the at least one aggregateddeposit account.